Lawyers Covered - April 2024

It can be tough for busy lawyers to find enough time to service clients, make it safely through the regulation obstacle course, win new work and keep up-to-date with developments, but we've got you covered!

Welcome to the April edition of our Lawyers Liability & Regulatory Update, in which we highlight the last month's key developments affecting lawyers and the professional risks they face.

Oops I clicked it, again

A couple accidentally divorced after solicitors press big red button

At a time when HMCTS is under immense pressure and questions of how processes can be further streamlined and assisted by technology are paramount, much has been made of the decision of the President of the Family Division, to uphold a final divorce order in Williams v Williams [2024] EWHC 733 (Fam) (10 April 2024) which, at first blush, appeared to be issued as a result of "clicking the wrong button".  However, all is not quite as it first appears.

The applicant's solicitors, in an effort to set aside the erroneously obtained final divorce order, submitted the application, made on the online divorce portal, without the authority of the applicant (a fact which was not challenged).  The "member of staff" had inadvertently opened the applicant's file rather than the file of another client.  The application for the order was made at 5.14pm on 3 October 2023, it was granted at 5.35pm the same day.  The application to set aside the order was made, without notice, just three days' later, on 6 October 2023 and the respondent was informed of this series of unfortunate events on 11 October 2023.

At first instance, on 17 October 2023, DDJ Underhill set aside the order on the basis it had been applied for in error.  The respondent, in applying to the President of the Family Division to set aside the order of DDJ Underhill, maintained the error was insufficient to give the Court jurisdiction to rescind the final divorce order, there being no factual or legal basis to do so.  The respondent relied heavily on the absence of any authority in which a final divorce order had been rescinded in the absence of any procedural irregularity, a submission the applicant did not challenge.

In deciding to uphold the final divorce order, Sir McFarlane stressed that the error lay not at the feet of the online portal, but rather with the user.  It was disingenuous to suggest it was a mere "click of the wrong button" in circumstances where the user had to go through numerous screens clearly showing the names of the parties before the application is submitted.  Sir McFarlane went on to find that, in the absence of procedural irregularity, it was not open to him, being bound by earlier authorities, to find that the final order for divorce could be set aside and indeed went further to say that, even in the event it was open to him, he would not have done so because it is "in the public interest that a final order of divorce should be unimpeachable".  If the applicant did not have a valid remedy against her solicitors, for example if it was clear the parties were on the course of reconciliation, we question whether this finding may have been different.

This case also holds a key lesson regarding without notice applications.  Sir McFarlane found the order of DDJ Underhill was not in any event valid or binding upon the parties because the application had not been served upon the respondent (albeit he was given notice of it).  It was not an application that could be made without notice (a fact agreed by the applicant before Sir McFarlane). 

Ultimately, with the ever-increasing use of online court services it is incumbent on solicitors to find appropriate methods of supervision and safeguards to avoid the sort of error made in this case

All Hale equality

Judges "wouldn't dream of being members of a club that excluded people from ethnic minorities, they wouldn't dream of being members of a club that excluded gays, but for some reason they seem to think it's okay to be members of a club that excludes women…It is a club to which a lot of lawyers and judges belong. And so it means that you’ve automatically got access to gossip and knowledge of people, that people who can’t be there don’t have."  So said Lady Hale when she became president of the UK's Supreme Court in 2017.  These weren't her first comments about the Garrick Club.  In 2011, when she was the only female Supreme Court Justice, Lady Hale spoke at a diversity event in which she was dismayed that so many of her colleagues were members of the Club.  In 2015, over 50% of the Club voted to allow women but, under the Club's rules, a two-thirds majority is needed for change to take effect.    

Not one afraid to ruffle feathers, Lady Hale, one of only five women to be admitted as a Justice of the Supreme Court, also recognised gay partnerships and dissented against recognising pre-nups, seeing them as "a retrograde step likely only to benefit the strong at the expense of the weak…[the case had] a gender dimension to the issue which some may think ill-suited to decision by a court consisting of eight men and one woman". 

In March, the Guardian published a list of Garrick Club members which included the King, the Deputy Prime Minister, Richard Moore, who is the Head of MI6, and Cabinet Secretary, Simon Case.  Within days, Moore and Case resigned their memberships saying they had been trying to effect change from within with Case being asked how he could "foster a genuine attempt of inclusiveness" when also a member of the Club.  That month, a member of the Club of over 40 years, Colin Brough, was ousted from the club after sending emails wanting to allow women to be admitted immediately.  It also saw the resignation of four judges.  As well as the resignations, two judges have had to be removed from hearing cases this month alone due to the potential for a biased outcome.

The Bar Council said the men-only Club creates the potential for an "unfair advantage" when it comes to practitioners needing a reference to become a judge.  The Bar Standards Board annual report published last month revealed that it would "consult on changing the current core duty not to discriminate unlawfully with a more positive duty to “advance equality, diversity, and inclusion"".  This may mean barristers would not be allowed to join the Club in the future. 

In a twist, a recent KC's opinion provided that the Club's rules already allow women to join as "he" is interchangeable with "she" in law.  Despite this, the Club is still calling a vote on it.  After 193 years of exclusion, a vote to explicitly allow women would be another step towards equality.

An open letter written by the Mindful Business Charter puts the onus on law firms to take action to monitor and assess risk, and to step in to reduce stress for employees

The open letter refers to the high pressure and demands experienced by individuals working in law firms. The letter follows the tragic death of a solicitor, Vanessa Ford, who was struck by a train last year and experienced mental health issues whilst working in law.

Actively monitoring the risk

The MBC calls for leaders in law to actively monitor their employees' workloads. The recommendations include leaders assessing how much sleep and down-time employees are getting. The MBC also suggest leaders should manage employees' workloads and reduce them where they are too high. At a day-to-day level, the letter suggests checking in with employees regarding their capacity and providing them with options for professional support for stress, ensuring conversations about the risks are conducted in an honest and straightforward way.

Discussions at partner level

The MBC suggests partners should recognise that "wellbeing is intrinsic to high performance". Further, the letter notes partners need to consider realistic ways to increase profitability without that being at the expense of lawyers working excessively long hours.

Individual level

The MBC calls for individuals to recognise that it is their responsibility to recognise that no job is more important than a person's health. Individuals should give their best selves to the workplace and take advantage of opportunities to grow and develop.

There is also a recognition to speak out for yourself and for other colleagues if you see someone struggling.

Regulatory

The MBC notes that whilst the Health and Safety Act 1974 includes psychological safety, the focus is more on physical safety. They suggest psychosocial health and safety should be addressed by regulation.

To post, or not to post; that is the question

In another reminder social media accounts of lawyers are not out of reach of the regulators, CILEX has recently stated that it "wanted to take this opportunity to just refresh everyone’s mind as to what the obligations under the code [of conduct] are." CILEX lawyers who are working in SRA regulated firms are subject to its professional guidance on the workplace environment and that the code of conduct applies "24/7".

Whilst there is some concern that such policies can stifle freedom of speech, the SRA's guidance explicitly states that, "[I]t is not our role to sanction fair comment or opinions, even if strongly put and others disagree." The main aim of the guidance is to ensure regulated lawyers behave in a way that demonstrates integrity and maintains the trust the public places in the profession and in the provision of legal services.

The reminder comes following CILEX's recent SGM, a recording of which was posted online. At the meeting, CILEX's Chief Executive, Linda Ford, told the attendees complaints and professional conduct cases concerning social media use had arisen. Such regulatory "incidents" and action will only increase with the ever-increasing presence of social media in both our personal and professional lives.

No Deal – Indemnity costs awarded against single-minded litigant

In the final act of a long running saga, a businessman faces a costs award of over £110,000 following the High Court's dismissal of claims he brought against two law firms.

The layers of litigation are manifold.

Mr Banner developed a TV game show format called "Minute Winner". He alleged this had been stolen by a Swedish production company and he brought a claim in the Stockholm District Court in relation to various intellectual property infringements. The claim failed.

Mr Banner applied to the Swedish Court of Appeal and subsequently the Swedish Supreme Court for permission to appeal. He was refused.

He then turned to the courts of England and Wales. This time, the claim was brought not by him but by a company owned by him: Banner Universal Motion Pictures Ltd (BUMP), which had taken an assignment of his intellectual property rights in "Minute Winner". The differences in the claims ended there: they were in essence the same and they were dismissed on the basis of estoppel and because they "were not sustainable on any basis".

Mr Banner did not let matters lie. His English solicitors (Fox Williams) were next in the firing line, together with the solicitors for the successful media company defendants (Wiggin). Mr Banner alleged they had acted in breach of their contractual and tortious duties. Both claims were dismissed. There was no prospect of the court finding any breach of duty and, in the case of Wiggin, they owed no duty in the first place to BUMP. Even if there had been any breaches, the claims were made out of time. They were struck out for an abuse of process.

To add to it all, Mr Banner reported the individual solicitors acting for Fox Williams and Wiggin to the Solicitors Regulation Authority, making allegations of professional misconduct, dishonesty and fraud.

It is hard to see what further action Mr Banner may be able to take.

Is this the final act or will the story continue?

Hong Kong: Final appeal judgment serves as reminder regarding waiver of legal professional privilege and duties to Director of Legal Aid

In previous updates we have covered the case of MK v Director of Legal Aid, in which the lower courts disagreed over the extent of the revocation of legal professional privilege between, on the one hand, a legal aided party and their lawyer(s) and, on the other, the Director of Legal Aid.  The Court of Final Appeal has now handed down its judgment. The judgment is unanimous and written by a respected overseas non-permanent judge and former President of the UK Supreme Court.

Approximately a month before the final hearing on 10 January 2024, the case took an unexpected turn when the Court invited the parties to make submissions on – "[W]hether waiver of legal professional privilege may be of relevance in considering disclosure of the financial resources of the applicant or aided person in the present case”.

In brief, the Court noted that it had not been disputed that the appellant had agreed to one of her lawyers providing the Director with confidential information about what had been said during a meeting that had taken place before the grant of legal aid – therefore, she had waived any privilege in the information as regards the Director. This was enough to dispose of the appeal.

However, the Court's judgment also goes on to examine the "tripartite relationship" between a legally aided party, their lawyer(s) and the Director. After construing the relevant statutory legal aid regime and regulations, the Court considered that (in any event) a legally aided party could not assert privilege against the Director – to that limited extent privilege had been expressly revoked.

The Court's judgment is a useful reminder of: (i) the principles regarding waiver of privilege; and (ii) assigned lawyers' duties to make relevant reports to the Director.  The judgment should also be of interest to lawyers in other jurisdictions – for example, the judgment refers to the relevant legal aid regulations in England and Wales and Scotland.

Additional contributors: Cat Zakarias-Welch, Sally Lord and Aimee Talbott

Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice. We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date. You should seek legal or other professional advice before acting or relying on any of the content.