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Commercial Awareness – A Multi-Faceted Concept

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18 January, 2018
Craig Sharpe, Law & Practice
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Commercial Awareness – A Multi-Faceted Concept

It is, as ever, crucial for law students entering the workplace to be commercially aware. But the concept of commercial awareness is no longer monolithic. Craig Sharpe, Marketing Manager, has written the piece below on its developing nature. Craig, who has more than 30 years in the legal field, will be providing further insights into this and other legal practice issues at a careers service event taking place on 7th February (details to follow).

Commercial awareness – multi faceted and one size doesn’t fit all

Travelling around the country visiting and speaking at different Universities, it’s clear to me that students are increasingly aware of the changing nature of lawyering. The buzzword that often summarises the major changes in legal practice and the market is “commercial awareness”.

When I talk to students it’s also clear to me that what constitutes commercial awareness is not always clear. The term can mean different things to different people and, crucially, it often means something quite different depending on the type and size of law firm.

Commercial awareness is more important because there has been a shift in the legal market

The traditional role of lawyers as pure professionals has largely disappeared over the last 30 years. When I say pure professional I mean a relationship where lawyers were used to protect clients without needing necessarily to understand much about the client’s business, where legal costs weren’t generally negotiated much by clients, and where the legal market wasn’t that competitive.

Things have radically changed, primarily based on a huge increase in the number of lawyers without the same increase in the demand for legal services.

Clients now shop around for lawyers and their expectations have changed.

For the largest law firms, on a basic level, commercial awareness tends to mean an expectation that trainee applicants demonstrate an understanding of: (1) how business works and; (2) the importance of understanding different business sectors. This is often the basic definition of commercial awareness, described in this article, and one which most students provide when I ask them what commercial awareness means. However, it actually involves a lot more and if students can demonstrate they understand it on a deeper level, this can be a differentiator.

Justifying legal fees and proportionality

Even the magic circle firms are now having clients demand justification of charging rates and their proportionality. The latter is especially important – the historical model was that lawyers would advise clients that, as professionals, they had to do a job thoroughly and that might mean costs could seem disproportionate to the commercial risk/advantage to the client. Clients, generally, simply don’t buy that argument any more. So, being commercially aware means understanding that clients almost always looking at whether legal fees are proportionate from a business viewpoint.

Commercial awareness can mean risk sharing

Historically, lawyers wouldn’t even consider sharing some of the commercial risk with clients and the practice was also seen as unethical. Times have changed and for some types of law, clients now expect their lawyers to share some risk. This typically applies to high value litigation, where increasingly, litigation funding (more here on the growth of litigation funding) and some form of partial risk sharing, contingency or no win no fee is being utilised.

So, lawyers and law firms are having to exercise commercial judgment as well as legal judgment in deciding whether to take on a potentially lucrative but risky case. In doing so, business considerations can also apply. For example, with a high value, multinational client, the commercial awareness aspect may also include consideration of how the client may view the firm going forward if the firm rejects risk sharing out of hand. In other words, if that clients goes elsewhere for a litigation matter, might they not come back for other types of work such as huge corporate transactions?

Internal commercial awareness

The example given above demonstrates that commercial awareness often has an internal as well as an external aspect. In addition to understanding clients, markets and so on, lawyers are increasingly being forced to adopt a business as well as professional approach. Being part of a law firm means understanding the internal commercial considerations that go on within that firm. Law students may well ask “how can law firms expect me to know about their business when I apply, I don’t have access to that information?”.

Business challenges for law firms

That’s a completely fair point of course. However, law students can gain an understanding of the changing market and how that impacts firms of all sizes. Whether a student may apply to a huge law firm or a very small one, appearances of unabated success can be deceptive and firms of all sizes now face unprecedented competition. For a smaller law firm, internal commercial awareness may well mean understanding that for that size of firm, they would expect a trainee lawyer to get involved in tasks that are not traditional fee earning.

In a firm like Darlingtons, a typical small to medium firm where I work, we expect trainees to be open to getting involved in marketing initiatives. In a competitive market, every member of staff needs to have an open and adaptable approach which is team centric. This is an example of how we perceive commercial awareness.

It’s worth remembering that about 70% of lawyers or more do not work in the big firms, so students statistically who pursue a career as a solicitor are more likely to end up working in a smaller law firm.

 

Is the Bill of Rights right?

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22 April, 2016
Carmen Huang
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HRA

It is no secret that the Conservative Party has always been critical of the Human Rights Act 1998 (HRA), which incorporated the European Convention on Human Rights (ECHR) into domestic law. Many of its prominent members have spoken negatively of it and, instead, advocate a British Bill of Rights. In the Party’s 2010 election manifesto, it proposed to “replace the Human Rights Act with a UK Bill of Rights”. Likewise, in its 2015 manifesto the Party made the same promise but added that this proposal “will break the formal link between British courts and the European Court of Human Rights, and make our own Supreme Court the ultimate arbiter of human rights matters in the UK”. Although Michael Gove, the Secretary or Justice, announced before the House of Lords Constitution Committee that the awaited Bill of Rights consultation have been postponed causing a delay in the government’s plan to scrap the HRA again, the question of whether a Bill of Rights is right for the UK remains controversial. With public outcries for the HRA’s repeal demonstrated by the Policy Exchange/YouGov statistic of 75% of Britons thinking the HRA are a “charter for criminals”, there seems to be strong support for this proposal. However, is this figure a product of the media and many politicians’ widespread apathy towards the Strasbourg court’s controversial rulings, especially in foreign suspect cases, or does it show genuine need for Britain to build a home-grown Bill of Rights?

In a House of Commons debate, Dominic Raab, the Minister for Human Rights, shed light on some of the perceived issues of the HRA which a new Bill of Rights will seek to solve, which Mark Elliott identified, including:

  • Granting “greater authority for the Supreme Court” so less will be “subordinated” to Strasbourg;
  • Stopping rights from being “distorted by judicial legislation”;
  • Stopping rights from “being abused by serious and serial criminals”;
  • And ensuring “sensible application and proper respect” for the “democratic role” of Parliament.

In answering questions from other MPs, Raab’s responses are vague in analysis. However, it is apparent that the Party’s concerns remain unchanged and seemingly intertwined.

First, there is concern towards the supposed “abuse” of rights by claimants who are seen as undeserving, namely foreign suspects who attempt to prevent deportation using human-rights laws after their prison release. As seen in the reactions to the Strasbourg court’s decision against the deportation of the suspected terrorist Abu Qatada, there is a great will for there to be a Bill of Rights with many antagonising the HRA. However, the idea that a human-rights claimant is ‘underserving’ does not rest well with the conventional notion of human rights. The ECHR was written after the horrors of the Second World War when it was believed that some fundamental rights, such as the right to be protected against inhuman and degrading treatment, should be enshrined with no get-out clause or exceptions. Some rights are fundamental in ensuring fair treatment and protection for all to prevent discrimination against particular groups such as foreign criminals from arbitrary power and populist opinions. Therefore, some human rights should be above the whims of parliament to protect minority interests. Introducing a Bill of Rights imply that, potentially, rights of these individuals will be compromised as the HRA is viewed as firearm for ‘undeserving’ claimants. With the notion that a human-rights claimant can be ‘undeserving’ and thus showing a lack of equal and fair treatment, just because the idea of a Bill of Rights is politically right, it does not mean it is morally right.

Second, the Party is also concerned over a judicial “mission creep”; the court is said to have manipulated the interpretation of a rational set of human-rights laws to the ‘undeserving’ claimant’s advantage. This contention illustrates the tension between the courts and politicians and their institutional role regarding the separation of powers; the crux of the issue is the argument that unelected judges should not apply human-rights law to contentious matters of public interest, such as the balance between the threat of deportation of a suspected terrorist against the potential danger of their stay to the public. The compromise between the public’s interest of being protected and the foreign suspect’s interest in pursuing a family life in the UK is therefore a domestic issue requiring a political value judgement. The judiciary, especially a foreign one, cannot claim democratic mandate to make judgements on cases this heavily involving the public. However, which other institution can we rely on to make such decisions? If anything, contentious cases require neutrality to a larger extent to avoid tyranny of the majority and to reach a fair balance. Politicisation of the decision risks the scale to be tipped heavily in favour of the frantic public who are highly responsive to the media’s exaggerated portrayal.

Lastly, Raab revealed a concern previously expressed by former Justice Secretary Chris Grayling, who advocated for “our Supreme Court to be supreme again”, that there should be an expansion in the UK Supreme Court’s authority in the expense of the Strasbourg court. This suggests that the concern is not with human-rights decisions by judges, but by specifically European judges. However, the argument lacks strength as it is unclear how and if the outcome would be different since all judges are supposedly politically neutral. Additionally, refusal to implement the Strasbourg court’s judgement may impact the obedience of other Council of Europe members. Recently, a bill in Russia was supported allowing Moscow to ignore judgements of international rights courts, foreshadowing the country’s rejection of the ECHR.

So, is the Bill of Rights right? Politically, it is obvious that it will please many voters. However, one cannot help but be sceptical about why the Conservative Party endorse the proposal so badly and what human-rights law will look like if they were to shape it to their liking. This is without even considering the international impact and the obstacles of backbench MPs, the Lords and the devolved assemblies.

Carmen Huang (Law)

Ideology in Private Law

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7 April, 2016
Contract Law, Derek Whayman
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IndentureIt can be difficult to find ideology in the dry world of private law. Undergraduates are often attracted to the more controversial parts of the law – for instance, public law – where ideology is overt. The only real difficulty is, however, the need to look a little bit harder.

The case of M&S v BNP Paribas concerned the exceedingly dry topic of the implication of terms into a contract. This case in effect overturned the previous leading case, Belize Telecom. It was a commonly-held view that the effect of Belize Telecom was that the court could imply terms that were not expressly put in a contract simply with reference to the process of construing the parties’ intentions. The law was not constrained by the restrictive ‘officious bystander’ and ‘business efficacy’ tests. It was a case of determining what was agreed. But this was said to be ‘wrong in law’ in BNP Paribas.

What possible ideological change could this have wrought? I suggest that it reflects acceptance by the senior judiciary, contrary to previous trends, that the private law cannot be made wholly subordinate to what persons and institutions want it to be without reference to external norms and community standards – what Alastair Hudson calls ‘autopoiesis’. Instead, the courts are recognising that private law, to some extent, has to be subordinate to external norms and standards. In short, private law cannot be privatised.

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Gay Marriage in Northern Ireland

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1 December, 2015
Authors, Colin Murray, Human Rights Law, Law & Equality, Legal Topics, Submissions
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“Northern Ireland Assembly Votes to Legalise Same Sex Marriage” proclaimed the headline in The Guardian. Few headlines have promised so much more than the subsequent story delivers. For in spite of the one-vote majority in favour of a change in the law in Northern Ireland in the Assembly on Monday, the DUP’s invocation of a “petition of concern” (POC) on the issue meant that it was able to veto the introduction of same-sex marriage in Northern Ireland. As Gerry Lynch put it, ‘it still felt like a punch in the plexus to finally secure a democratic majority through years of hard work only for it to be vetoed undemocratically’. With rich irony the Northern Ireland Act provisions designed to protect minority groups against predatory applications of majority power have been turned into a means of stymieing reform aimed at delivering marriage equality.

It wasn’t supposed to be like this. With the spectre of the Northern Ireland Parliament’s permanent Unionist majority dominating the drafting of the arrangements for the Northern Ireland Assembly at the time of the Good Friday Agreement, POCs were intended to maintain consociationalism within Stormont by requiring a super-majority and cross-community support where Northern Ireland’s Unionist or Nationalist parties considered that a measure threatened the interests of their community. The ability of POCs to block any legislative change has instead seen them increasingly applied as a strong-arm tactic to prevent changes to the law with the aim of preserving the status quo or extracting concessions in return for a POC being lifted. DUP measures, indeed, appear to be block signed by party MLAs with the issue to which they are to be applied being added to the form at a later stage. Public confidence in the Stormont Assembly’s ability to address the needs of society in Northern Ireland has plummeted.

Whilst the DUP’s stance on gay marriage might be out of step with opinion polling across Northern Ireland, it remains popular with its own core supporters and so the political incentive to wield a POC (ahead of next year’s Assembly elections) remains strong. But if the democratic institutions in Northern Ireland remain so dysfunctional, will the courts intervene to permit gay marriage? Legal challenges to the limitations are already underway in the Northern Ireland High Court. The UUP leader Mike Nesbitt, whilst describing opposition to gay marriage as being on the “wrong side of history” (whilst maintaining his own vote against change), has told his party conference that he expects the new law to be forced upon law makers through the courts.

Forcing law reform through judicial decision could unblock this particular impasse. The need to react to an adverse court decision might help the Unionist parties to soothe the evangelical elements amongst their support base, being “saleable” as a long-resisted reform that was forced upon the parties. All the better if the judgment is not issued until after the Assembly elections. And for people who want to get married, a win is a win, and they are not likely to sniff at the courts forcing the pace of change.

So should the courts intervene? Under section 6 of the Northern Ireland Act the legislation of the Northern Ireland Assembly is not valid law if it is outside the legislative competence of the Assembly (a concept which includes making a law which breaches ECHR rights). But as the Northern Ireland Assembly has not made a law banning Gay Marriage, just failed to enact one allowing it, the general provisions of the Human Rights Act (and its incorporation of the ECHR into UK Law) will apply.

Whilst the ECHR includes a right to marry (Article 12) the Strasbourg Court has to date refused to rule that it is discriminatory for states not to apply this right to homosexual couples. In July, in its latest judgment on the issue,Oliari v Italy, the Court maintained that as only 11 of the 47 states signatory to the Convention had to date accepted same-sex marriage, there was no European consensus in favour of reading such a right into the terms of the ECHR. Many Unionist politicians picked up on this point in Monday’s debate:

The European Court of Human Rights has ruled that same-sex marriage is not a human right, so this is not a rights issue. (Gordon Lyons, DUP)

There is no human right recognised by the European Convention on Human Rights or the European Court of Human Rights to same-sex marriage. It therefore cannot be and is not a rights issue, nor is it an issue of equality. Rather, there is a worked-up, phoney demand for rights where none does or should exist. There is no equality issue here. (Jim Allister, TUV)

These same politicians will eagerly and angrily decry any effort by the Northern Ireland courts to change the law on human rights grounds. But Article 12 is not the only applicable ECHR right. The Court has established that the relationship of a cohabitating same-sex couple living in a stable partnership falls within Article 8 ECHR’s protection of “family life” (Schalk and Kopf v Austria), this might provide a basis for arguing that, as same-sex marriages concluded in other parts of the UK are treated as Civil Partnerships within the Northern Ireland jurisdiction, the awkward legal transformation of a marriage into a civil partnership as soon as someone steps off a ferry or plane amounts to discrimination.

Moreover, the definition of marriage in Northern Ireland law – “the voluntary union for life of one man and one woman to the exclusion of all others” – rests on a nineteenth century judicial decision, Hyde v Hyde (backed up by secondary legislation – the Matrimonial Causes NI Order 1978). By altering this definition the courts cannot be accused of tossing aside legislation enacted by elected lawmakers, a fact which might embolden any judge concerned about the political backlash resultant from such a decision. They also have a much freer hand in terms of their powers under the Human Rights Act than they would have had if the definition of marriage was contained in primary legislation, if they can be persuaded to move ahead of Strasbourg on the issue of Article 12.

This room for manoeuvre makes the gay marriage cases crucial tests for the role of the courts in Northern Ireland’s system of government. On a range of issues from gay marriage, to the ban on gay blood donations to the strict limitations on abortion, judges in Northern Ireland are increasingly being confronted with cases which highlight the blockages in the Assembly’s law-making process. Some might decide that the time has come to chivvy the Assembly along.

Colin Murray.

Prisoner voting rights are another intractable struggle over Europe’s architecture for protecting human rights

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21 October, 2015
Colin Murray, EU, Human Rights Law
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handcuffsLast week, an appeal by a French prisoner to the EU’s top court against his voting ban revived the debate about prisoner voting rights in the UK. Colin Murray writes that although the appeal was unsuccessful, the ruling did not foreclose the possibility of future successful challenges to bans on prisoner voting. He suggests that it is highly likely that some UK prisoners serving short sentences will claim that their disenfranchisement is disproportionate to their crime in the run up to the 2019 European Parliament elections, indicating the issue will continue to be a thorn in the Conservative government’s side.

It has been eleven years since the Fourth Section of the European Court of Human Rights issued the Hirst v UK judgement. In that time, the issue of prisoner voting rights has become the touchstone for the fraught relationship between the UK and the system of rights protection under the European Convention on Human Rights (ECHR). Whilst other crises (such as Abu Qatada’s deportation to Jordan and the reviewability of whole-life sentences) have been resolved or defused, the Strasbourg Court’s demand that the UK modify its blanket ban on convicted prisoners voting has remained an intractable source of conflict, inflaming the Conservative’s manifesto pledge to replace the Human Rights Act with a British Bill of Rights.

For all of the political fulmination upon prisoner voting in the run up to the 2015 General Election, the UK’s showdown with Strasbourg has of late settled into an uncomfortable stalemate. The UK is in continuing breach of its Article 3, Protocol 1 obligations and as such is subject to regular censure before Committee of Ministers’ meetings for its failure to execute the prisoner voting judgments. At the same time, however, the Strasbourg Court has made it clear, in Scoppola v Italy, that minimal reform of the law to extend the vote to short-sentence prisoners would satisfy the UK’s obligations, and in Firth v UK has denied compensation to UK prisoners for the breach of their rights.

The Court’s first olive branch has been snubbed (with successive Governments failing to respond to a Parliamentary Committee’s recommendation, almost two years ago, that short-sentence prisoners should be enfranchised). But the UK Government’s refusal to meet the Court half way is unsurprising, given the Court’s refusal to press the issue. Strasbourg’s denial of compensation ensures that David Cameron does not have to justify make embarrassing payments to prisoners, effectively downgrading the clash from crisis to a running sore point.

The détente between Strasbourg and the UK makes last week’s judgement of the EU’s top court, the Court of Justice of the European Union (CJEU), even more intriguing. Serendipitously timed for release to coincide with David Cameron’s speech to the Conservative Party Conference (and the ten-year anniversary of the Strasbourg Court’s judgement in Hirst), the CJEU’s judgement in Delvigne v Commune de Lesparre-Médoc caused such consternation that Downing Street was obliged to deny that the UK would change its ban on prisoners voting even before the decision was known. The binding effect of CJEU judgments in domestic law means that its intervention on the issue would be much harder for the UK Government to side-step (at least with regard to European Parliament and local elections) than Strasbourg’s rulings.

In the end, Cameron’s speech was not upstaged, with the Court accepting that EU law was not breached in the ongoing denial of the vote to a convicted murderer in France over a decade on from the end of his incarceration. But if the judgment isn’t exactly headline-grabbing, is Joshua Rozenberg nonetheless right to argue that it means that the UK Government should act now on prisoner voting?

In many respects, the Delvigne reference was easy for the CJEU to resolve. The reference by the French Court was poorly constructed, with the Court being supplied with much less background information to the question of EU law its opinion was being sought on than it would usually expect (opening the possibility of ruling the reference inadmissible). The claimant had not attempted to follow the process which existed in French law to lift his disenfranchisement. Moreover, as a convicted murderer, France could make arguments about the seriousness of his offence warranting the additional punishment of disenfranchisement. The Court accepted that in some cases disenfranchisement was compatible with the EU’s Charter of Fundamental rights. Two years earlier, in Chester and McGeoch, the UK Supreme Court had reached the same conclusion on the limitations of the right to vote under EU Law:

I reject the submission that the Supreme Court could or should simply disapply the whole of the legislative prohibition on prisoner voting, in relation to European Parliamentary and municipal elections, thereby making all convicted prisoners eligible to vote pending fresh legislation found to conform with European Union law … under [EU law] a ban on eligibility will be justified in respect of a very significant number of convicted prisoners.  (Lord Mance, para.73)

And yet, in spite of these unpromising aspects of this case, the CJEU did not foreclose the possibility of future successful challenges to prisoner disenfranchisement using the Charter. The Court rejected the argument of the UK Government, intervening, that EU law was not engaged by criminal law sanctions or was not a live issue because the case involved a French national challenging French Law, and therefore involved no “cross-border” element. The Court affirmed that Article 39(2) of the Charter, by which “Members of the European Parliament shall be elected by direct universal suffrage in a free and secret ballot”, did not need any cross-border element to generate a fundamental right enjoyed by EU citizens.

This means that in certain cases, claims for votes by prisoners will engage a Charter right. In the run up to the European Parliament elections in 2019 it will be highly likely that some UK prisoners serving short sentences will claim that their disenfranchisement is disproportionate, given that the ban on voting applies automatically irrespective of the level of criminality which triggered imprisonment (which can be much lower than the serious criminality at issue in the Delvigne case) and there is no avenue to challenge the ban (as there was in the Delvigne case). These factors were determinate in the CJEU finding that French law involved a proportionate restriction of the right to vote. Such claims will be hard for the UK courts to dismiss out of hand, and could at the very least trigger a reference to the CJEU for consideration (as they previously refused to do in Chester and McGeoch, because of the serious criminality of the claimants in that case).

“Victories” like this one are therefore hard for the UK Government to crow over, even if they do help to kick the issue into the long grass for a few more years. It may ultimately be better for the UK Government to respond when it is not being forced to by pressure from a European Court (not that successive Governments have not revelled in the image of “standing up to Europe”). But perhaps the most interesting aspect of the case is the degree to which the CJEU staunchly refused to engage with any of the ECHR jurisprudence on prisoner voting. The Advocate General’s Opinion, released this summer, reached broadly the same conclusion as the CJEU (that EU law was engaged, but that the ban was proportionate), but did so based on extensive reliance upon Strasbourg jurisprudence.

The CJEU, however, continues to fear that it might lose out to Strasbourg as the ultimate arbiter where EU law engages human rights questions. Last year, it refused to allow the EU to accede to the ECHR and in Delvigne, as with other recent cases, it has shunned any mention of Strasbourg in its decisions out of concern over letting Strasbourg’s influence grow by the back door. Prisoner voting rights are becoming a central feature of yet another intractable struggle over Europe’s institutional architecture for protecting human rights.

Colin Murray is Senior Lecturer in Law at the University of Newcastle