Hillsborough: it was absolutely important that no facts were hidden

I have written before on the solicitor instructed by South Yorkshire Police in the aftermath of the the Hillsborough disaster.  The Independent Panel report made a number of  criticisms of the conduct of evidence management for the Police, especially (although not solely) the amendment of witness statements by the solicitor, Peter Metcalf.  It seems from the Coroner’s summing up that much of that amendment process was overseen and conducted by Mr Metcalf personally.  It was also done under considerable pressure of time and of circumstance.

You can read the Coroner’s summing up where he deals specifically with Mr Metcalf’s evidence here and here. It is a fascinating account, which reveals amongst other things that Mr Metcalf saw himself, or portrays himself, as representing individual police officers collectively when he plainly was not: he was instructed by the police force. If his claim is an accurate depiction of his state of mind at the time, I would argue he did not know who his client was or deal properly with the conflicts he was operating under. It’s an important point because at the time the Police were obliged to be candid with Lord Woolf investigations.

We can see something of the confusion about who the client was in the Coroner’s, Sir John Goldring, summing up:

Mr Metcalf agreed there was a responsibility on South Yorkshire Police to present the facts, warts and all.  He said South Yorkshire Police was not a corporate body, but a group of individuals.  As I understood what Mr Metcalf was saying, it was that he was representing  the individuals.  He had to think about them.  He said he did not approach his role like that of a traditional insurance lawyer who would have said that, “We say nothing … do nothing … give nothing until it is asked for.”

He said he never felt any tension or conflict between his duties as described in the letter to Lord Justice Stuart-Smith and the responsibility of candour which South Yorkshire Police owed.  He said, with the benefit of hindsight, it was “possible” he was operating under something of a tension or conflict.  If so, he said, it was not deliberate.

The most important allegations are the way in which evidence was managed.  Police officers were told not to write accounts in their notebooks (as  was standard practice) but to write plain paper statements. As far as I am aware, Mr Metcalf was not the instigator of that decision. Questions of Mr Metcalf’s conduct come later in relation to his amendment of draft statements from witnesses.

One of  the claims made by Mr Metcalf is that he sought to remove opinion or hearsay evidence which would not be helpful to the Inquiry, or would very occasionally he conceded he had removed factual information, but he said those facts were red herrings he was justified in removing to protect his clients.  Anyone who wishes to pursue that argument should read the Independent Panel Report which calls into question this argument.  Here’s what the Independent Panel noticed:

116 of the 164 substantially amended statements removed or altered comments unfavourable to SYP. These included 41 statements in which alterations downplayed or removed criticisms made by officers of their leadership and of the police response to the disaster. These commonly included any indication or impression that senior officers had lost control of events, or that they were ill-equipped to respond to the unfolding tragedy. The amendments also frequently included deletions of references relevant to the failure to effectively monitor the pens and close the tunnel once Gate C was opened.

A number of the alterations are dissected. Statements such as the following were deleted:

“I at no time heard any directions being given in terms of leadership. The only messages I heard were those requesting assistance of one sort or another, and where appropriate, their acknowledgements.”

“I have to state that even at this stage and this location and with a number of higher ranks in the area nobody seemed to be organising the injured.”

“The Control Room seemed to have been hit by some sort of paralysis’”

“[T]he organisation of this event was poor, as has been the case for most of the season. Too little notice had been taken of current trends and football intelligence and too much reliance has been placed upon previous information held.”

“Too many non-operational supervisory officers were in charge of important and critical parts of the football ground.”

“The deployment of officers around the crucial time needs to come under scrutiny, too many were sat around in the gymnasium whilst others were rushed off their feet.”

As I said when I blogged on this previously, one can see how some of these could be generously interpreted as opinion evidence but they also contain key recollections about the police response to events. Similar concerns were expressed about police radios and poor communication between senior SYP officers and their colleagues. Some of the alterations related to a crucial incident at the previous year’s FA Cup Semi-Final where “SYP officers referred to crushing in the outer concourse area”. On  these police were, “asked by the SYP solicitors, Hammond Suddards, to reconsider and qualify their statements.” It was a key area, relating to the claim that the Police knew of the safety risk posed by the Hillsborough stand and that SYP had previously controlled entry to the pens where fans died but did not on the fateful day. References to ‘chaos’, ‘fear’, ‘panic’ and ‘confusion’ were also altered or deleted from statements.

We can get a further sense of the problems in this account from the Coroner.  As noted already an issue of concern was whether officers in SYP had, and knew about, a policy (it was called the ‘Freeman policy’) of tunnel closure to protect against influxes of fans of the sort that led to this tragedy but which was not activated in 1989.  A Chief Inspector Creaser had, “said at the deputy chief constable’s debriefing meeting [on the 19th April] that he knew of the Freeman policy” before 15 April (the date of the disaster).  On 2 May, “Mr Creaser saw Mr Metcalf when Mr Metcalf went to Snig Hill to speak to the senior officers whose statements had been requested.  On 3 May 1989, Mr Creaser made a statement.  The Coroner notes, “It did not mention previous closure of the tunnel.  It did mention he had been on duty at both the 1987 and 1988 semi-finals.”  The Coroner then says this:

Mr Metcalf agreed that, in retrospect, it was surprising that previous tunnel closure did not appear in his first statement.  Mr Metcalf said there was no connection at all between him seeing Mr Creaser on 2 May and Mr Creaser not mentioning tunnel closure in his statement of 3 May.

The Coroner continues:

On 2 June 1989, Sergeant Higgins made a statement. In that statement, he said that at the 1988 semi-final he had been instructed to close the tunnel gates and divert fans to the outer pens.  On 5 June, three days later, in other words, Inspector Creaser gave evidence to the Taylor Inquiry.  Sergeant Higgins’ statement was not before the inquiry, a statement, in other words, in which he said he had been instructed in 1988 to close the tunnel gates.

Mr Creaser spoke, when giving evidence, of the previous closure of the tunnel at the previous semi-finals.  He said Sergeant Higgins had been involved.  Chief Superintendent Mole and Sergeant Goddard had given evidence before Mr Creaser.  Each had said the tunnel had not previously been closed, as Mr Creaser had said.

That was on 5 June, so, again, recapping the dates: 2 June, Higgins’ statement, 1988 semi-final, said he had been instructed to close the tunnel gates to divert the fans to the outer pens; 5 June 1989, Mr Creaser gave evidence to the inquiry, the inquiry did not have Mr Higgins’ statement of 2 June.  Mr Creaser told the inquiry of the previous closure and said Sergeant Higgins had been involved.

Mr Mole and Mr Goddard had given evidence previously. Each had said the tunnel had not previously been closed. On 12 June, Mr Metcalf asked that Sergeant Higgins’ statement about tunnel closure be reviewed to see whether it was dealing with duties during phase 2 of the match, that is to say, after kick-off.  On 7 July, Mr Metcalf advised: “Is it the case that my suggested alterations were not acceptable to ex-Police Sergeant Higgins?  If so, we shall have to think what to do.”

Mr Higgins’ statement ultimately went to the inquiry on 12 July 1989, after the evidence hearings were over.

Mr Metcalf agreed it should have gone before.  He said he could not say why it did not.  He did not accept this sequence of events was an example of him trying to control the narrative which went to Lord Justice Taylor.

Members of the jury, I want now to deal with a letter that Mr Metcalf wrote on 13 June to the Municipal Mutual Insurance Company, which were the insurers of South Yorkshire Police.

On 13 June, Mr Metcalf wrote to the insurers to advise them about developments in the inquiry.  He commented that statements recently collected described officers barring access to the tunnel in 1988.  He said this was “most unhelpful evidence, from our point of view”, and that they were asking that the officers concerned “be asked to review these statements carefully before they are submitted”.

Mr Metcalf did not agree that these comments amounted to twisting and turning, as it was put to him, to avoid criticism and responsibility of South Yorkshire Police.

Rather than comment, I am going to give the last word to Mr Metcalf as represented by the Coroner. We should bear in mind, before deciding whether we accept this version or not, that Mr Metcalf was operating in a most unusual situation and one imagines under significant pressure when he dealt with all the police statements in the aftermath of the terrible events at Hillsborough .

When asked whether there was anything about his approach to preparing and presenting evidence to the Taylor Inquiry that was not satisfactory, Mr Metcalf said this: “I think I would say, first, I deeply wish I hadn’t been in that position in the first place.  Secondly, yes, I have no doubt I have made mistakes.” He said he did not feel that at any point he was in a position of having to put forward evidence which supported a particular case for South Yorkshire Police.

No senior officer, directly or indirectly, gave the impression he ought to be doing that.  Mr Metcalf did not accept that he used the Salmon letter as a checklist for areas in which he was going to try and sanitise the evidence.  He was not engaged in a concerted effort, he said, with senior officers to try and protect the force at all costs. Mr Metcalf agreed that it was imperative that South Yorkshire Police should be entirely upfront and honest and tell the whole truth to the public inquiry.  Mr Weatherby suggested it was imperative they did not try to hide anything or act defensively.  Mr Metcalf said that the issue of acting defensively was a bit more tricky.  He thought the attitude at the start was to say that it was not simple, rather than South Yorkshire Police holding its hands up.  This did not mean they were defensive in the sense of being dishonest.  It was absolutely important, he said, that no facts were hidden.

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Public Access Research – a couple of quick points

The Bar Standards Board and the Legal Services Board have jointly published a consultants project into public access (the system under which barristers may see client’s directly rather than being instructed through professional advisers, especially solicitors).

…there appears to have been relatively modest beneficial impacts for consumers, with respect to widening choice, improving timeliness of access to legal services, and reducing costs. This is partly because not all clients or cases are, in the barristers’ opinion, deemed suitable for public access. However, barristers doing higher volumes of public access work, and those authorised to conduct litigation, reported higher levels of beneficial impacts…

Very fairly, the reports authors point out they would largely be unable to report on consumer risks because they had no data from the consumers themselves.

Perhaps the most important impression given from the data is that public access is growing and that the main barriers to it are the inability of clients to take on the more complicated bits of cases that barristers are reluctant to do under public access.  Litigation and correspondence were, for some, problem areas creating undesired work. Two things stuck me as interesting:

  • some of the barrister respondents may have been uncertain whether – when they were helping their clients – they were conducting litigation (and so some may have been doing so when not authorised – it’s not clear if this is an error driven by the way the surveys were completed or something that is really happening); and,
  • whilst most public access work came through recommendation, a fair proportion of work was received through an intermediary. This made me wonder whether the Bar’s ban on referral fees was vulnerable in practice.  Unsurprisingly, the report is silent on this.

A more interesting question for me is the extent to which barristers or ancillary providers are able to develop systems, web platforms, apps, and so on to support the ‘unbundled’ model of legal services that public access could lead.

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Specifically instructed: Don’t be a tool?

As a young lawyer, in the seventies office block that housed Sheffield’s County Court, I remember a small epiphany.  It involved discovering the import of the phrase, “I am specifically instructed.” I was only just out of law school, a wet behind the ears trainee, and I recall a small thrill as I picked up the legal equivalent of a masonic handshake.  It was the language of the insider, dissembling to keep outsiders at bay. I enjoyed the excited vanity of a neophyte lawyer entering the club, and a little sliver of discomfort as my law school clinic training urged me to reflect critically on the received wisdom.

For those not yet initiated, to say one is specifically instructed is to say to the judge, My client has been told what I have to say has no merit but I am asked to say it anyway or to similarly say I think my client is wrong.  The client might be bonkers or malicious or misguided and without a nod or a wink, but with two words, an advocate has engaged in a kind of phoney advocacy.  The client has the feeling of their point being made. The judge has the signal that the lawyer is not really making the point. A little bit of gristle is implanted in the sausage of justice.   Perhaps the client’s interests are compromised, but probably they are not.  The feeling of justice being done is maintained and the lawyers and judge do not have to waste too much time on weak or extraneous arguments. There are times when it is a convenient subterfuge, and times where it may be more insidious.

Now, every time I hear the phrase specifically instructed I cast back to that moment. The silly pride has dissipated, a bit, but the discomfort has not. So it was with interest that I read about the lawyer for the killer of a Glasgow shop owner (Mr Asad Shah) who indicated he was specifically instructed to read out a statement on behalf of his client.  According to the Guardian the statement began:

My client Mr Tanveer Ahmed has specifically instructed me that today, 6 April 2016, to issue this statement to the press, the statement is in the words of my client.

I don’t think it is necessary to discuss the statement in detail. As I read it, it says Mr Ahmed believes it was necessary to kill Mr Shah because Mr Shah claimed to be a prophet. This is a different explanation for the killing than had been reported in the press. Different, if not more comforting – at least to me.  What I do want to draw attention to is that the lawyer, Mr Rafferty, indicated both that the statement was the client’s own words and that he was specifically instructed to issue the statement in full.  Assuming he chose his words carefully, it is as if he is saying, to those in the know – I have told my client not to say this but he insists, so what can I do?

I wondered, momentarily, whether Mr Ahmed understands that Mr Rafferty has sought to distance himself from his client in this way (assuming I am correct about the intention behind his words), but I am not really concerned about that here.  What really interests me is whether Mr Rafferty had to, or ought to, have issued the statement and done so with the words ‘specifically instructed’.

The Scottish rules on public statements by lawyers about court proceedings concentrate on the lawyer making clear that opinions of the client are clearly described as opinions of the client and that such statements are in the client’s interests. I am grateful for Jonathan Mitchell QC pointing me towards the Anwar decision:

If [the client’s lawyer is] of the view that it is in their client’s best interests to make public comments on court decisions in proceedings in which they have been involved, about which we ourselves say nothing, we consider that their duty to the court requires them, in doing so, to display the highest professional standards. In particular, we consider that they have a duty to ensure, first, that their public utterances, whether critical or not, are based upon an accurate appreciation of the facts of those proceedings and, second, that their comments are not misleading. Regrettably, we do not think that those standards were met in this case. If any such comments are intended to represent nothing more than the client’s own views or reactions, whether right or wrong, justified or not – and a certain degree of latitude would ordinarily be extended to such views or reactions – that can and should be made absolutely clear.

We see here the need to be clear that the client’s opinion or view is being offered not the lawyer.  That risk is dealt with in Mr Rafferty’s statement by saying it is the client’s words and it is not edited. We can see also that the Anwar decision indicates, as do Scottish Law Society rules,  that the lawyer needs to form a prior view that such a statement is in the client’s best interests before they make it.  If I am interpreting his words fairly, by saying I am specifically instructed, Mr Rafferty appears to be indicating either that he does not believe it to be in the client’s interests to make the statement (in which case why make it?) or he does believe it to be in the client’s best interests but is undermining it’s impact with in-the-know legal audiences by saying he has advised his client against it (or something similar).  Neither position seems to me to be a strongly defensible one – but I may be missing alternative explanations.

It raises a bigger issue.  Is it the lawyer’s proper role to make legally irrelevant or legally damaging points for their client in public? One can imagine situations where it may be important to win a public relations battle as part of the conduct of the case (the cases of Katherine Gun or Clive Ponting come to mind) but that needs to be carefully balanced with one’s obligations to behave independently and (in the lexicon of the Scottish Code) honourably. Put more bluntly, one has to be on guard against being the client’ publicity tool if this conflicts with one’s role as legal representative.

Similarly, I am not at all sure one can perform either function properly whilst hiding behind the words: I am specifically instructed.  Either he has decide the statement is in his client’s interests (in which case the words are unnecessary and potentially misleading) or he has decided the statement is not in his client’s interest: in which case he should not make it.  There is a third possibility, that it is in his client’s interests to make the statement, but also in his client’s interest that he distances himself from it.  My mind begins to boggle a bit at that point.

I must make room for cock up rather than conspiracy in my analysis: perhaps he did not think about what he really meant when he said he was specifically instructed, or mispoke in the heat of the moment, but if he is trying to convey the sense that he had no choice but to issue the statement he may be misleading himself or some of his audience.  This would be most likely if the position is as in English law, and the text from Anwar and the Law Society rules suggest the position is probably the same, the lawyer does have to reach a positive view such a statement in public is in the client’s interest, it is almost never enough for a lawyer to be ‘specifically instructed’ by their client to do something. The lawyer has to decide to do it in their client’s best interests and with a careful eye on their broader duties.

 

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ABSs not cheaper

Some interesting research conducted for the Legal Services Board by OMB Research has caught a few headlines.  It’s on an interesting topic, is the liberalisation of legal services stimulated by the Legal Services Act leading to a better deal for consumers? More specifically (because the quality side of the better deal is beyond the research’s remit) have prices come down? The answer is a tentative no.

The big baby of the LSA2007 is the creation of ABSs.  Whatever their potential benefits (I think there are some), they have not (yet) been associated with lower prices a key finding from this research was:

“There were no significant differences between the prices of Alternative Business Structures and other firms.”

Fixed pricing of legal services is associated with lower prices (this is not as much of a no brainer as one might expect: it is plausible that those pricing their fees on a fixed basis price in a larger margin to cope with variation in the cost of doing somewhat variable work and that – as a result – this might drive up costs).

Oh and legal services like beer (and perhaps baked beans) is more expensive in the South East. Serves Mr Farage right.

So unless one sees fixed pricing in wills, conveyancing and simple divorces as a product of the Legal Services Act then these results don’t suggest the Act has made services cheaper (and so more accessible).  For my part, it is possible that the Act was one catalyst for the increased use of fixed fees, as more directly is the decline in legal aid in family work post LASPO for instance, but I do not see in this research evidence that the Act has had a significant, still less a dramatic impact on price.

What the research suggests does impact on price is consumers shopping around and the 17% of firms who display their prices on their websites, because, as the research notes, “firms who do display prices on their websites are generally cheaper than those who do not.” ABSs (or more likely a strong consumer referral website) may yet lead a consumer revolution, but there is little sign of it yet on price – at least on this research.

 

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The end of low-qualified lawyers?

Deloittes 2016 report [Developing legal talent: Stepping into the future law firm] has garnered some attention for suggesting a ‘tipping point’ is coming to the legal profession as early as 2020.  In truth, as interesting as the report is, it has not really produced new evidence to support the claim that, “[Legal services businesses] will need access to lawyers who have a broader skill set and are not just technically competent lawyers.” This seems to be the guts of their case:

There are still significantly more law graduates than lawyer jobs available. Of those who find employment after graduating, over 60 per cent do not go into a job in the legal profession (see Figure 3). This ‘over-supply’ means that law firms are able to select what has been perceived as the best candidates. However, over the next decade, factors such as partners retiring, a shortage of appropriately-skilled workers and alternative career options in-house or within Alternative Business Structures could transform the profession into an employee-led market.

And:

…businesses are already identifying a mismatch between the skills being developed through education and those required in the workplace. Data from Deloitte’s Quarterly Legal Sector Survey shows slow growth in revenue generated per fee earner among the top 100 law firms (see Figure 2).

The productivity problem is an interesting one and skills do of course play  part.  Big Law are (a bit) worried by millenials who might not have the loyalty that big firms are even less inclined to show them than the once were.  Even so, that’s quite along hop and a skip to an employee-led market.  Much of the ‘productivity’ is embedded in big firms with high value work, for all that the likes of Riverview Law are chipping away at bits of it. And, in any event, the case made by New Law for productivity gains is that they show up not in the productivity of the legal service providers but in the productivity of those they service as least the way that productivity is counted here.

The report does show some interesting data on the overall growth in the legal activities sector .  Growth 2004-2014 is surprisingly flat but volatilely so.deloitte trends

Flatness occurs in spite of the number of solicitors’ growing by 17% between 2010 and 2016 (according to SRA data they quote). The feeling I came away with was it wasn’t the end of (qualified) lawyers we were seeing but the end of many more less qualified roles (some paralegal and most legal secretarial roles) and the entry of a more diverse – hopefully skills rich – body of non-lawyers into legal service providers.  This up-grading of the employee body may reflect also the shift of the market away from lower cost services (personal injury and legal aid being two field in particular which have contracted and may account for the post 2011 slump in legal activities employees above).  My feeling was reinforced by this next graph suggesting which bits of the legal employment market were ripe for technological disruption.
deloittes automation
We can see that in fact there has been growth in the number of paralegals but they are vulnerable to automation unless they are ‘other legal professionals’ in which case they are not so vulnerable. The difference between the two groups is not clear to me. My best guess is legal associate professionals here means those who work outside law firms, and ‘other legal professionals’ means those who work in law firms – but I speculate.
Another point of interest is the graph on gender and graduate employment destinations below. It is worth bearing in mind that significantly more women than men graduate from law school and that a higher proportion of them get 2:1s and 1sts, yet according to Deloitte’s data a lower proportion of women go ‘straight’ into the solicitors’ profession. It’s a little bit of an odd graph as the data source’s ‘other’ category probably reflects the high proportion of students going onto PG study – the LPC and BPTC in particular.
Perhaps the more telling differences for the women are that they are more likely to become legal associate professionals or legal secretaries straight from University.  We can only speculate on the why.
deloittes gender
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Professionalism and Ethical Leadership From General Counsel’s Suite

A Guest Post by Azish Filabi and Jim Lager

Maybe it was easier in the old days for in-house lawyers to be the de facto conscience of their client organizations. Lawyers have a keen sense for the peril and risk that lurks just past the next opportunity, and accordingly had a great influence on how their organizations exercised their discretion. Wise counsel was both sought and dispensed by general counsel for decades. Assuring corporate compliance with governing law and regulation was a natural part of a corporate lawyer’s duties.

Many corporate counsel still serve this traditional function, yet with increasing frequency, lawyers are succumbing to economic, structural and behavioral pressures to stay in an increasingly narrow lane demarcated by the law’s four corners. There is an emerging consensus that lawyers have become the “loophole finders” within organizations. The growing academic literature on the shifting landscape for lawyers is well documented (and produced) by the Center on the Legal Profession at Harvard Law School. The authors of the paper “Lawyers as Professionals and as Citizens: Key roles and responsibilities in the 21st Century” mark the various contextual challenges lawyers confront in the current marketplace. Their analysis highlights that one consequence of the increasing competition in the legal profession is the pressure on lawyers to deviate from the ethical duties of lawyering. In particular, the rise in size and prominence of in-house legal departments is at the center of the continued shift in legal practices.  Initially, departments were expanded as a response to increased costs of services offered by law firms, and now they pressure those law firms to increase their own efficiencies and reduce their costs.

The pressures on lawyering are also evident in the debate about the role of the CCO (chief compliance officer) vis-a-vis the GCO (general counsel’s office). Although an understanding of the law is essential to compliance, it is not essential for compliance to be inside the general counsel’s suite. There are advantages to organizational separation of compliance from the chief legal officer’s purview, including assuring that allegations of improper behavior receive appropriate (and independent) attention, and demonstrating the corporation’s commitment to compliance by giving it a high-level status.

A separate compliance department does have its downsides. It increases the likelihood of turf wars between the two offices, and fuels the tendency to view compliance professionals as outsiders who may be kept away from the important social networks and the informal communication channels necessary to understand how decisions are actually made. Separation of compliance from legal may also increase the risk of the general counsel’s lawyers serving as mere legal technicians, responsible only for telling clients what the law permits and forbids. Based on organizational logic, separating the two functions could lead to conclusions that the responsibility for all ethics matters will reside in the CCO. For a legal department, this would further discourage lawyering from serving as wise counsel with professional responsibilities not only to the client but also to the public.

We think that good ethics makes compliance easy, and a corporation can have a good ethical culture irrespective of the company’s organizational chart. Research tells us what we all know intuitively: ethical behavior in organizations stems not from codes, the adoption of procedures or the location where “compliance” is housed, but instead from actions based on our understanding of human behavior.

Although no single “best practice” is obligatory, and certainly one size does not fit all, there are some steps behavioral science teaches us will be effective. For example, we know that good ethical modeling by those in authority has a significant effect on the behavior of others. Therefore, we believe that corporations—with the sound advice of their counsel—should carefully consider the advantages and disadvantages of each approach to compliance, and choose the approach that is more likely to foster ethical conduct. Positive role-modeling remains essential for all leaders if an ethical culture is to be maintained and, with it, a strong compliance posture.

Regardless of where compliance functions are located, general counsel are well-positioned to be ethical leaders in their organizations. To exercise ethical leadership, however, they need to be careful to avoid common behavioral pressures–in particular those that, in service to their client’s demands, may disserve their client’s long-term best interests. Pressure on lawyers to be increasingly responsive to client short-term needs can encourage ethical fading, a psychological process in which you eventually lose sight of the ethical dimensions of your decisions because you are focusing too narrowly on a single perspective. For lawyers, serving a client’s immediate need, particularly under pressure to retain future business, a job or increased compensation, narrows the frame of reference away from the broader professional duty of lawyering and providing competent advice.

Ethical fading by lawyers who see their role more as legal technician than as wise counsel has had disastrous consequences for both clients and the public, as the role of the General Motor’s lawyers in that company’s ignition switch failure debacle shows. In that case, as highlighted in the investigation report by Anton Valukas, lawyers served a narrow legal duty to the client by settling cases concerning its ignition switch for nine years without raising the matter as a safety issue. This delay not only racked-up the additional costs of vehicle recalls, regulatory fines and long-term costs associated with reputational damage, but also reportedly 90 deaths due to the ignition switch failures.

Other structural pressures on the profession can encourage unethical behavior. As Professor Langevoort of Georgetown Law School writes in his paper on behavioral compliance, increased competition between in-house and external counsel over the cost of production (i.e., legal advice), and business downturns can encourage unethical behavior because it triggers emotions (especially fear), a short-term orientation and risk-taking. For some, self-protection could lead to taking an unscrupulous stance in negotiations, or even outright deception, justified consciously or unconsciously, as vigorous representation of their client.

As professionals, lawyers must take care to assure that self-interest does not supersede client interests. Balancing these interests requires lawyers to avoid what psychologists Ann Tenbrunsel and Max Bazerman have termed, in the context of ethical decision-making, as a conflict between a person’s “should self” and their “want self”. The want self may pursue pecuniary or other short-term interests, which are sometimes also aligned with the client’s immediate goals, without questioning if the means to those ends are right. Lawyers attending to their should selves would instead consider the full breadth of their professional obligations to their clients and justice, the ethicality of the way the clients want to meet their goals and their client’s long-term interests. Lawyers listening to their should selves would be a wise counsel to their clients, and could not remain silent in the face of a potentially lethal safety issue.

It is difficult for amoral lawyers to meet their professional obligations to their client. Further, amorality risks immorality, leaving ethics to others and, in the end, neither serving the client nor the public interest. A culture of amorality in the general counsel’s office could lead to one where ethical transgressions become banal, so commonplace to a culture that it becomes infused with  irresponsibility, giving little consideration to reputation or stability.

Ultimately, everyone throughout an organization is responsible for its ethical practices. An ethical systems approach recognizes the centrality of individual responsibility, but also the organizational and systemic pressures that could discourage wise counsel and the ethical behavior that comes with it.

Azish Filabi is CEO of EthicalSystems.org where she dedicates her time to developing strategies for businesses to promote ethical behavior in their organizations through research and collaboration with the leading experts in the field. She currently serves as an officer in the New York State Bar Association International Section. Previously, she was an ethics officer and bank regulatory lawyer at the Federal Reserve Bank of New York, and a corporate associate at Curtis, Mallet-Prevost, Colt & Mosle.

Jim Lager is the deputy ethics counselor at the U.S. Government Accountability Office (GAO), adjunct professor at the Robert H. Smith School of Business, University of Maryland, and an Ethical Systems collaborator. The views expressed here are not intended to reflect GAO’s institutional views.

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Reprinted with permission from the “February 29, 2016” edition of the “Corporate Counsel”© 2016 ALM Media Properties, LLC. All rights reserved.

Further duplication without permission is prohibited. ALMReprints.com – 877-257-3382 – reprints@alm.com.

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More than a footnote on legal professional privilege

Lord Neuberger, in a recent short speech, provides some interesting insights in to the problematic world of legal advice privilege (LAP), but he does so with one eye closed.  Let me explain.  He begins with this:

Although the need for LAP where no litigation is contemplated or exists has been judicially doubted [he is referring to Lord Phillips], these principles are well established, and they appear to be workable and clear. And so they largely were in the world in which they were developed, a world so different from ours in many ways. We now live in a world which has global electronic communications, instantaneous international transactions, criminalisation of bribery and cartelism, detailed regulatory systems, increased investigative powers, large and international and complex corporate structures, and, it must be said, highly sophisticated financial and economic fraud. And we live in a world where the law of privilege as developed by judges is modified on a rather ad hoc basis by legislation, and is subject to a number of different sets of published official guidelines.

He mentions the problem of legal advice is given by non-lawyers (and averts to the Prudential case, perhaps regretting – although he does not say so -the way in which the Supreme Court ducked the issue) and then begins to suggest, intriguingly, that LPP may be out of date:

…it is plain even to me that many aspects of modern commercial and legal practices give rise to potential problems in relation to LPP. Particular problems appear to have arisen from the marked increase in the domestic and international fields when it comes to regulatory and criminal sanctions in the corporate environment.

He discusses cross-border co-operation between lawyers when applying the protection of common interest privilege, and whether the US originating practice of a written joint defence agreement provides the protection of privilege.  It is, he says simply, an, “open question and has never been tested.”   In the context of corporate clients he points out, advice privilege only applies to communications between a lawyer and the corporate client rendering the question, “which individuals constitute “the client”?” important.  He accepts the position that , “LAP does not appear to attach to communications between the solicitor and employees or agents of the corporate client, other than the individuals actually being advised by the solicitor – e.g. the chairman, the CEO, the COO, and the CFO, or the executive committee, or a group specially designated by the board or the CEO or chairman,” but also notes that other common law jurisdictions take a much broader approach to the client.  In a Francis Urquhart kind of way, he invites someone to bring an appeal to allow the Supreme Court to ‘consider’ the point.

He also then points out that, in cases where litigation privilege does not apply to internal investigations, there is no privilege in communications with witnesses other than the client.  This would I think be pretty much all such investigations where litigation is not imminent.  He seems to say, work out in advance which group of executives constitutes the client and don’t game that approach too hard and the court will probably regard this as satisfactory – protecting the interviewing of those employees [the senior executives] with privilege. Not particularly edifying, but sensible advice unless one takes the potential for intra-corporate conflicts of interest over such investigations seriously. This is a point which he does not even mention (in the twenty minutes he was allotted for his speech).  An investigation that reports to all the subjects of the investigation as the client is an odd kind of independent investigation. An investigation that interviews beyond that group is not subject to privilege, at least in part. What is the rationale for this kind of mess?

He moves on then to look at the approach of the SFO when they look for “a genuinely proactive approach” to investigation and self-reporting. I take him to be saying that the SFO requires a difficult decision by the Corporation that finds itself at the centre of wrongdoing as to whether to waive LPP . Lord N points out, this, “is a very valuable right, and it is a big and irrevocable step to waive it.” Whilst also going on to point out the many uncertainties around contested privilege claims.  He points to Barclays’ reported (but until then expensively hard fought) surrender of privileged documents:

it is unclear why the privilege argument was being abandoned – whether it is the fraud exception, or the absence of the dominant purpose requirement or fact that the documents were outside privilege because of Three Rivers (No 5) is unclear.

Tempting as it is to say otherwise I solemnly remind you here that you should not make your mind up until you know all the facts.  But how will you (or the SFO or the court) know all the facts? If you do not know all the facts, what should your working assumption be? Given burdens of proof and the like, this probably means giving the Bank the benefit of the doubt.

He also points out that investigations in the context of  cartel offences give rise to a defence that (section 188B(3)) the person concerned:

“took reasonable steps to ensure that the nature of the arrangements would be disclosed to professional legal advisers for the purposes of obtaining advice about them before their making or … implementation”.

He assumes that to rely on such a defence would require a comprehensive waiver of privilege, covering all the documents related to the seeking and giving of the advice.  Criminal practitioners accustomed to advising (sometimes) less sophisticated punters on the dangers of waiving privilege when asserting a right to silence might be thinking, boo bloody hoo.  But Lord Neuberger stills those crocodile tears, by going on to muse on giving the Company human rights protection.  The statute might be read as weakening LPP by mere (but sensible) implication, he suggest, but the fundamental human right of LPP may stop arguments about implied waiver from succeeding.  This is an approach which, if adopted, will encourage a market for bad advice of the kind that Jolyon Maugham QC has so clearly criticised in tax law.

Lord Neuberger ends with this simple plea:

I believe that this takes me to my 20-minute limit, but, before I stop, I would like to say that this short tour de piste of what is only a few aspects of the law of LPP gives rise to two feelings on my part. The first is how difficult the role of a professional adviser can be in an increasingly complex and fast moving world. So often, she is faced with a problem which not only is hard to answer and requires a quick answer, but is one to which there is no safe answer: go wrong one way, and she will be advising her client to break the law; go wrong the other way and she will be unnecessarily disadvantaging her client. Secondly, and concomitantly, judges and legislators have to try harder than ever to ensure that the law is simple, clear and accessible.

I must say, and with all due respect, and as much mildness as I can muster, that this is a rather disappointing way to frame the question.  The motivating concern appears to be the position of the adviser.  In official justifications of legal professional privilege, especially legal advice privilege, the justifications are most definitely not supposed to be centred on the needs of the adviser.  The academic literature, imperfect as it is, points out that the historical origins of privilege and some of its application mean privilege has been developed with too keen an eye on the protection of lawyers.  If you want a little clue as to the recognition of this, notice from now on how often a judge or similar reminds the audience that privilege is the client’s right, not the lawyers. They do that for a reason. Lawyers need reminding of it.

Notice also what is missing from this lecture.  Lord Neuberger speaks of what he knows, with his audience on the night in mind.  He was also invited only to give a very brief speech.  So I am not wishing to sound censorious, but I do think there is a very large and unheard part of the story missing here.  That story would include:

  • The significant anxieties expressed by, inter alia, the Director of the SFO about how privileged internal investigations have the effect of cleaning up crime scenes;
  • The ways in which corporate investigations can be used to mislead investigators (the News of the World’s interactions with the Culture Media and Sport Select Committee being a particularly well exposed one but similar if less acute problems are often seen in practice).
  • The role that privilege played in the approach of General Motors’ to its recent ignition switch problems.  In that case, privilege may have literally contributed to lost lives.
  • The role that privilege played in Big Tobacco’s attempts to conceal document destruction in Tobacco litigation. There’s a fascinating Court of Appeal case on very troubling facts decided by Brooke LJ which makes fascinating reading.

Such examples are not the whole story, and are emotionally loaded, but they are absolutely vital nonetheless.  I have resisted the urge many times since the creation of this blog to write about the pros and cons of privilege.  It is an idea too engrained in the profession, and artificially elevated by judges and I have not made up my mind about the pros and cons, so why take it on? Even suggesting legal advice privilege is wrong is likely to lead to an exaggeratedly hostile reaction. I haven’t got the energy for the grief.

Yet, I do not think the case for legal advice privilege is as clear or obvious as the profession plainly would like it to be.  Legal Advice Privilege is useful. Legal Advice Privilege is harmful. Legal Advice Privilege is abused.   Legal Advice Privilege protects.  Legal advice privilege in corporate contexts however does not protect the individuals if the corporation decides to waive it.  Furthermore, the need to encourage the corporation to take legal advice when it otherwise would not, which is one part of the justification, is somewhat weaker in corporate contexts.  The arguments about privilege supporting trust building between lawyers and corporate actors holds some water, though a good deal of that same water leaks out when one understands how vulnerable corporate employees can be to the ‘real’ client waiving privilege.

There is a particular case for reconsidering LAP in the light of the complexities and uncertainties that Lord Neuberger identifies but one simple answer would be to abolish it. Or abolish it for companies.  Or abolish it for companies when relying on lawyers as reputational intermediaries.*  Other answers might be to strengthen and clarify the exceptions.  Or to think very hard about what independent investigations carried out by legal professionals should really look like.  I really do not know. I am not advocating a position, but I think we should think about the issue from a wider perspective than ‘this makes the lives of lawyers difficult’.  This kind of difficult decision is what the £1,000 an hour rates are for.  The substantive harms caused by privilege may or may not be outweighed by the benefits of privilege, for advice, in the corporate context: but we at least have to weigh those harms properly.

*Okay that one may not be so simple.

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