Lord Chancellor, my Lords, Ladies and Gentlemen, welcome to the Annual Dinner of the Institute of Barristers’ Clerks…
My first year in office has been a varied and interesting one. I have given talks on Contractual terms to a joint COMBAR/Chancery Bar event, a daunting task in front of 300 lawyer. One of the most enjoyable events was as guest of honour at the Middle Temple clerks’ evening, which takes place every 5 years. Having to speak immediately after the Treasurer The Rt Hon The Lord Judge was also quite daunting.
On international work and welcoming foreign litigants…
I have also spoken to a delegation of lawyers from the US and most recently a delegation from Russia and China under the Bar Council exchange Scheme. I attended the Bar Council’s delegation to Shanghai, Beijing and Seoul as Chair of the IBC last September led by Maura McGowan QC who I am delighted to see is here this evening. I even gave a speech at the Peace Palace in Shanghai; it does not get much better than that for a clerk….
But whilst international work may well be the way forward, London needs to be careful. Other jurisdictions are providing arbitration facilities and encroaching on London’s territory. Indeed Singapore is due to open its International Commercial Court as well this year, with judges on a £1M salary, allegedly. Not enough to tempt our judges though, I am sure.
I have six members of chambers working in Singapore this week. We are flying the flag in legal exports, but I am sure that five years ago those cases would have been heard in London. All the cases use English law as the choice of law. When I was in Seoul last September, most of the major Korean law firms stated that until recently, their choice of venue for their clients (and there are many large multinational companies in Korea), was London and New York, with English law contracts. It is now Singapore with English law contracts. London could therefore be missing out, not in lawyers’ fees but in influence and invisibles. We must ensure that we make the international business community and foreign litigants welcome in London. There should be no criticism of foreigners using our courts.
You, Lord Chancellor, and the Government should welcome them. They come to London for the quality of our judges, the first class service of Barristers and our respect and adherence to the rule of law. English law is the choice of law for the international business community. It is the law of merchants and we are very lucky that it has developed as such.
On the BSB Handbook…
Regulation has come to the fore with the new BSB Handbook. Despite some grumbles the IBC think the BSB have done an excellent job in producing the new Handbook and they should be congratulated.
One of the major changes to the Handbook is that legal aid may now not be considered a “proper fee” and is therefore not subject to the cab rank rule. How ironic that the regulators have recognised this.
The challenge for many clerks though has been the implementation of rule 22 in the new Handbook in relation to contracting with each solicitor on every new set of instructions from 6 January this year. This has led to a huge explosion in paperwork and adapting computer systems to ensure clear records of who has agreed what, and when. But the real challenge has been negotiating with each firm. The time taken, I would estimate has been up to 20% of additional work for many senior clerks.
On COMBAR/CLLS Terms…
Many firms, of course, have adopted COMBAR/CLLS B terms, with amendments in their favour, such as deleting assignment from the contract, or adding terms that would invalidate the barrister’s insurance by adding clauses in relation to unlimited liability, or clauses that would incur on a barristers’ professional obligations, particularly in relation to confidentiality, (for example on the disclosure of whether you have worked for any party involved in the litigation in which you are to be instructed, or what cases the barrister might have been involved in prior to instructions). Whilst many major law firms have a huge compliance team crawling over the contracts, the majority have no idea of the professional obligations that barristers have - and the clerk ends up dealing with the majority of these contracts and terms, prior to confirmation of the barrister being happy to sign.
As a clerk, I and many others are very concerned how COMBAR/CLLS Term B, where the solicitor will simply use best endeavours to pay Counsel, is acceptable. But of course the law firms are in a dominant position; agree the term or we will not instruct you. How can it be right though that a leading city law firm, with perhaps a £1Bn turnover, can contract with a junior Barrister say charging £50 an hour, on the basis they will use best endeavours to pay them. No law firm would enter into this contract, no expert would agree such a contract, but the Bar is lumbered with it. It does the legal profession no good at all and you wonder of all professions, how has this happened. Something for the regulators perhaps? Some might say that the terms have been negotiated, but COMBAR do not represent the Bar.
On referral fees…
Referral fees are also a problem. The IBC has received many complaints from its members recently as well as members seeking advice. Of course we are all aware that Irwin Mitchell’s suggestion of a reciprocal arrangement whereby the amount of work billed by a set of chambers would be monitored and chambers would have to pay 10% of fees back to Irwin Mitchel by other means. Several ideas such as training and providing in-house cover were quite rightly rejected by the BSB as a referral fee. However a more insidious system is now operating which is not condemned by the BSB.
There is a consortium of entities in the North West comprising of a number of public bodies that are mainly local authorities. This consortium says that they have a computer portal that needs to be paid for to allow them to instruct Counsel. They request that chambers pay them a sum of money, in some instances up to £1,000, to register with them. If you do not pay the sum, you will not receive instructions, or even be considered. This has been brought to the attention of the BSB and has not been rejected as a referral fee.
The clerks’ concern is that if you are not allowed to receive instructions or bid for work if you do not pay a fee, then this is nothing more than a referral fee, however it is disguised. No money, no work. But I feel it is also more pernicious. Smaller chambers may well be at a disadvantage if the fee rises each year and the larger chambers are happy to pay whereas smaller chambers cannot; they will be knocked out of the competition for work. However, I suppose that should be filed under a “free market”.
The IBC would ask that the BSB again look very carefully at such a scheme or anything similar that they allow. We do not know if we can appeal any decision on such schemes to the LSB or indeed the Ombudsman, but it is something the IBC are now looking into. If it appears not to be acceptable to solicitors, then why is it acceptable for the Bar? The IBC are also aware of a number of organisations who are looking at similar schemes for the Bar on the basis of what the consortium are doing.
On the Bar Pro Bono Unit…
One of the success stories for the Bar is the Bar Pro Bono Unit. Its services are required more than ever now. Many Barristers’ clerks assist in finding Counsel, but the real heroes are members of the Bar who give so freely of their own time. There have been 1,914 requests for assistance over the past year up to March 2014 an increase of 50% over the previous years. 80% of cases are accepted. The Unit has over 3,500 panel members including a third of all QC’s. Many MPs phone the Unit asking for assistance for constituents as they cannot get legal aid. If you take into consideration the fabulous work that the Free Representation Unit does, having over 1865 referred cases, then the Bar should be congratulated in what they do for the community. This is one success story though that you will never read about.
Legal aid for criminal work has also hit the headlines and is causing great concern to many clerks.
There is no need to recount the difficulties in relation to the Op Cotton case. What does interest me though is the immediate knee jerk reaction of the MoJ press office when the case was stayed upon application due to insufficient representation for the defendants. For example it was stated that ‘a Barrister would earn good money in any event, £100,000’. This seems a lot of money; let’s examine it. The trial was set down for four months (later the indictment was split and the trial was three months with other defendants being tried for six-eight weeks). There were 46,030 pages of evidence. In addition 194 excel spreadsheets with a combined total of 864,200 lines of entries. The case was described by the Court of Appeal as “an extremely important but complex case”; an experienced QC would have allowed three months in preparation time. Now taking a very conservative 50 hours per week - although we all know criminal lawyers work late into the evening - spread over seven months this works out at a very conservative 1400 hours; divided into £100,000, it works out at £71ph. The MoJ normally include VAT in their calculations when they quote figures for the Bar, but I shall not, but expenses may equate to around 20%. So the figure for a good quality silk, dealing with an extremely important but complex case works out at £57ph profit.
On the future of the Criminal Bar…
The future for the criminal Bar is gloom indeed, as clerks have been known for many years. But nobody thinks of the long term consequences. We often hear of fat cat lawyers gorging themselves on public funds - I wonder if Walter White of Breaking Bad is working in the press office - but you never hear of the junior Barristers traipsing around the magistrates court all day for £50 and paying their own expenses and travel costs (and that’s if they can get the work). Nor indeed of the 45% cuts in real terms for criminal legal aid over the past seven years before the 30% cut for VHCC. Equality of opportunity is becoming a serious issue now, particularly at the criminal Bar, where pupillages are becoming so scarce. The BPTC course is £18,000 alone, pupillage minimum is £12,000. At £50 a day, with no hope of paying of your student debt, the future is very bleak indeed. The cuts are also seriously affecting working mothers at the Bar with high childcare costs.
Why is the criminal Bar discriminated against when it comes to public funds? After all, the treasury counsel panel rate (which is public money), for Barristers above 5 years’ Call is £80ph. This rate has not changed for at least 15 years; compare that to an experienced criminal silk on £71ph.
On the Jeffrey report recommendations for working models…
Sir Bill Jeffery in his report on “Independent criminal advocacy in England and Wales” raised concerns and stated “If the Bar’s share of the work continues to decline, as the current generation moves to retirement, the supply of top end advocates to undertake the most complex trials will be a doubt”.
But perhaps a greater concern is where will our judges come from in the future.
Sir Bill also states that chambers should adjust its model of working to compete for legal aid contracts. This seems reasonable but there are difficulties for many chambers.
The advantage is that chambers hold the purse strings and can dictate.
But, as many clerks know, there are big disadvantages: most sets won’t have the experience of running such a contract and would almost have to become a mini law firm, needing agents to cover the police station work and probably some form of solicitor/paralegal assistance to prepare cases. Once solicitors know you are bidding against them, this will affect the flow of other work to chambers – another big disadvantage. If a chambers does become an ABS, will there not be conflict issues, for example how could you possibly have members both defending and prosecuting a defendant where Counsel are from the same ABS? So the choice for the public becomes much more limited. The independent criminal Bar would be no more. Moving into legal entities that share risk and profit will ensure this and I feel that neither the Regulators or Government are aware of the consequences. They seem to think that practising from a company or legal entity is the same as practising from a set of chambers. It is not.
I am always particularly interested in articles on the law and especially how to save money. One particular article grabbed my attention written by a lawyer from Tuckers. He suggested that Barristers could cut costs in three ways; not having an office or chambers, having no IT facilities and God forbid, no clerk. Barristers should be “virtualised”. They should work from home and wait for somebody from Tuckers to call them no doubt. It is not suggested, but any cost saving would no doubt be creamed off by Tuckers or even passed on to the LAA? No mention of course that the same concept should apply to his own firm. But it did get me thinking. What about virtualised judges, that would save a fortune or dare I say this in front of so distinguished a guest, a virtualised Lord Chancellor, perhaps that may not save so much. Indeed what about virtualised courts, witnesses and defendants. The cost saving would be enormous. Of course the reputation of our system might be brought into question and justice may be seen not to be done but the cost saving….
The article also went on about how good HCAs are. They may well be, but all Barristers’ clerks know that judges are now getting very concerned about the quality and the drop in standards of the advocates appearing before them. I suspect many judges may now be burdened with additional work in reporting on the quality of advocates in some awful report they have to do each month in the future. The system is beginning to fail and we clerks all know why.
But the biggest cost to our system of justice is surely waste.
Last September it was reported that research by the London Assembly Conservative group revealed that 23,000 criminal cases in London’s Crown and Magistrates court were dropped or delayed, of which no fewer than 9500 “were due to failing by the CPS”. Replicate that nationwide.
This is a huge waste in the system, a vast waste of taxpayers’ money, our money and needs to be addressed.
Preserving one of the best legal systems in the world…
You, Lord Chancellor, have quite rightly pointed out on many occasions that we must recognise that our legal aid system is one of the most expensive in the world. But what of course you Lord Chancellor I am sure, also recognise, as we all do, is that our legal system is also one of the best in the world. The Bar has played its part, the criminal Bar has certainly played its part The Bar is one; it is not split in civil or criminal, publically funded or private. IT IS ONE. As the best in the world, the Lord Chancellor to the judges to the court staff to the lawyers, clerks, short hand writers, ushers, interpreters to the estimated 320,000 who are employed in legal services in England and Wales, we should all be proud of our legal system. The income from legal services is estimated at £26bn so there is no subsidy at all. Indeed if you wanted to split the legal services into two, private and publically funded work, it is quite obvious that the privately funded lawyers subsidise the whole of the legal aid budget with a huge excess left over, so no cost to the taxpayer.
Can somebody please tell George Osborne?