Bar room blitz

The English bar is in high demand in the world’s offshore centres. Three of the bar’s key figures explain why

The offshore legal market has seen a massive boom in litigation, providing increasing opportunities to the English legal profession. But how does the bar fit into this arena?

Stephen Moverley Smith QC, XXIV Old Buildings(pictured)

With the decline in trial work in the English courts in recent years, the bar has been casting covetous eyes in the direction of the offshore world, where the appetite for litigation continues unabated.

Jurisdictions such as the Cayman Islands, the British Virgin Islands (BVI), Bermuda and the Bahamas have an exotic allure; less exotic but no less busy are the courts of the Channel Islands and the Isle of Man.

The super-rich have long been eager to use offshore vehicles both to structure their business empires and as a medium for joint ventures. When things go wrong the first port of call is usually the local court. Given the vast sums of money usually involved, clients often want to look for assistance beyond generalist local lawyers.

As the offshore jurisdictions largely have an English common law background, the natural focus is the pool of specialised talent at the English bar, which is used to dealing with the complex corporate, trust and conflict of law issues that such disputes generate. It is, of course, necessary to master local legislation, precedent, practice and procedure, as well as being sensitive to the position of the local bar.

Previous insensitivity has led several jurisdictions to become increasingly protectionist, particularly in relation to junior counsel. That said, the ability to access the English bar has become a selling point for many offshore jurisdictions. For those who have established offshore practices, the future looks rosy.

Robert Graham-Campbell, chief executive, Maitland Chambers

Offshore markets are proving to be increasingly important for both advisory and litigation-based lawyers. Growth in these markets is being fuelled not only by an influx of investment funds, but also by the increasingly central role these jurisdictions play in the financial structuring of cross-border corporate deals.

The bar, in particular the commercial chancery bar, has so far retained its significant involvement in these developments by providing a combination of skills: on the one hand, its intellectual rigour in advising on the development of cutting-edge law, for example in the fields of modern commercial trusts or tax structures and, on the other, its extensive experience in handling complex multi-jurisdictional disputes, whether from the position of risk management, case management, alternative dispute resolution or litigation.

The amount of offshore work originating out of London is increasing and London is now one of the main legal hubs through which international businesses access the offshore markets. The interplay between the London bar, major law firms in the UK and the specialist offshore firms is becoming more and more extensive.

If the larger solicitors’ firms are a source of international clients and transactions to offshore markets, the bar brings a distinctive breadth of specialist experience, gained both domestically and internationally, to complement the undoubted skills of the specialist offshore law firms.

The commercial chancery bar, whose expertise in trusts law, banking, fiduciary duties, partnership law, the principles of equitable remedies and, of course, fraud, asset tracing and insolvency in commercial matters has the ideal skill set for problems thrown up in offshore markets.

Richard Millett QC, Essex Court Chambers

The bar fits in with caution and sensitivity.

The English bar has always had a strong reputation for advice in connection with the establishment of offshore trusts and family arrangements for the creation and protection of wealth. It continues, and some chancery sets have had long-standing relationships with local firms in tax-neutral jurisdictions which have traditionally provided a stream of quality non-contentious work.

However, in the last decade, contentious litigation in ‘blue-water’ jurisdictions such as the Bahamas, the Cayman Islands and the British Virgin Islands (BVI) has boomed. This started as a trickle, with big trust-busting cases like Thyssen [2004] in Bermuda and the long-running Anders Jahre (Compass) [2007] litigation in Cayman seeing huge teams of English barristers in the courts. That trend continues, the most recent example being the Weissfisch [2006] litigation in the Bahamas.

However, Cayman has grown as an offshore banking centre, particularly for structured investment vehicles and mutual and hedge funds, and the BVI has seen an explosion of international business companies incorporated on Tortola holding interests in businesses worldwide, particularly in the US and Hong Kong and the Far East. Both jurisdictions have modernised their company and insolvency laws in order to keep a little more in step with the English model.

The proliferation of international cross-border corporate litigation, particularly over share sales, mergers and share ownership and minority rights, in high growth industries such as telecoms and high-value retail brands, has meant quality work for the English commercial bar outside the confines of the chancery sets. –