Finers hits back at LDA in row over payment of Olympic fees
22 August 2005
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19 December 2005
It is no great surprise to open up the papers and discover Mark Stephens' name, but the media-friendly head of international and head of media at Finers Stephens Innocent does not usually qualify as news himself. Not until this month, that is, when a bitter slanging match erupted after the London Development Agency (LDA), the body responsible for buying land for the London Olympics, dumped the professional team it had instructed to act for those businesses in the East End which will have to find new homes. The LDA has accused its former advisers, including Finers (which is claiming around £540,000 in fees) of fleecing the taxpayer.
"The Olympics are for all the people and not for fat cat lawyers. They're not a gravy train," Murad Qureshi, a member of the London Assembly, told the press. "It's important for the progress of the Games that we get this sorted out. We need people to know this is not going to be a source of easy money. There will be many contractors involved and they need to get the message."
So how does Stephens respond to the charge of 'fat cat-ism'? "If they need to use hyperbole to attack me, it must be because they're feeling guilty about something, and I think they're feeling guilt about not dealing with my clients," he responds. His firm has been acting for 120 businesses that need to strike deals to relocate or else face compulsory purchase orders. In an increasingly bitter footnote to the good news story that is London 2012, there are some 11,000 jobs and 308 businesses at risk in the area. Companies are struggling to find alternative space in the capital because they have lived in a deprived part of town with relatively low land and rental values. Tempers boiled over in the run-up to the successful vote in Singapore when angry business owners threatened to spoil the party by flying out to lobby against the London bid.
Stephens believes it is his clients' opposition to the London games, rather than concerns about fees, that is at the heart of the spat. "They can use any amount of insults and personal attacks they like, and they can attack the lawyers because everyone blames the lawyers - that's a familiar refrain," he says. "But there's a process that's going on here which has offended our very notion of fair play."
By contrast, the LDA claims to have gone "above and beyond the requirements of the Compensation Code in offering to negotiate voluntary provisional relocation deals in advance of 6 July and in offering to pay for the necessary legal and surveying fees incurred by businesses wishing to take up the offer". It adds: "We're continuing to go over and above the requirements of the Compensation Code in offering to pay lawyers and surveyors for the businesses and in offering to find alternative sites for the businesses."
Following Finers' invoice, the agency wrote to the firm on 12 July giving notice to terminate the contract with its professional team - Finers, loss adjusters the Balcombe Group and surveyors Jones Lang LaSalle. "It is clear that there is a substantial degree of uncertainty as to the nature of the contractual relationship between our client, the business and the professional team," wrote the LDA's lawyers Eversheds. "We consider that it is not in the interests of any of those parties to allow this uncertainty to continue, given the fact that London has now been awarded the 2012 Games and we are in a position of certainty as to the future." Stephens is confident his firm will be paid its £540,000 fees, which he insists are perfectly reasonable for acting for 120 clients. Over the last 18 months, it works out at around £8 per day per client, he adds. For those commentators surprised to find a high-profile media and human rights lawyer immersed in a property wrangle, Stephens claims to have done a lot of property work when he first set up in practice and is also currently representing a client in an unrelated planning inquiry.
But what about the businesses left in the lurch? Lance Forman of H Forman & Son ("Widely acknowledged as Britain's leading salmon smoker", according to Harpers & Queen magazine) calls the attack on the lawyers "diversionary tactics".
"The LDA has just dragged the deal out for nine months, shifted the goal posts, delayed and done everything under the sun not to complete because they didn't want to as they never thought that London was going to win the Games," comments Forman. "Consequently, hundreds of thousands of pounds of professional fees were built up unnecessarily because the LDA was stringing it out." He makes no criticism of Finers. He also reports that the businesses sought meetings with ministers, such as Culture Secretary Tessa Jowell and Minister for Sport Richard Caborn, but "like the executioner, they don't want to look us in the eye before chopping our heads off", he says. Forman reckons that, if his business, which employs 50 people, does not find a new home in the next few months, it will be finished. "We've been in the East End for 100 years. We should be celebrating our centenary, but instead we're fighting for our survival," he says.