UK disciplinary tribunal slaps Mishcon with £25,000 fine for rules breach

A leading sports lawyer was also embroiled in the matter, which involved football transfer transactions

UK disciplinary tribunal slaps Mishcon with £25,000 fine for rules breach

The UK’s Solicitors Disciplinary Tribunal (SDT) has slapped Mishcon de Reya with a £25,000 fine for accounts rules violations involving the use of a client’s account to pay third parties engaged in football transfers over 2011-2015, reported the Law Society Gazette.

Leading UK sports lawyer and former Mishcon partner Liz Ellen was also embroiled in the matter for allegedly having “caused or allowed” the utilisation of the account as a banking facility.

The order following a hearing last month where the SDT was told that payments amounting to millions of pounds were issued to “deal wreckers” that could block transfers. Mishcon was regarded as a middleman between agents and the football club involved in the issue.

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The tribunal rejected the defence that “payment of monies by [Mishcon] was a necessary part of the legal services provided,” tribunal chair Andrew Spooner said in the decision. The argument that a “lack of trust between the parties altered the status of receipt of payment of monies such that the firm was not in breach of the banking facility rules” was also shot down.

The firm accepted the ruling and acknowledged the rules breach.

“Any findings are of course most unfortunate and the firm must and will pay heed to them in our process of continuous improvement, but there is no suggestion of any wrongdoing beyond these limited findings. We are glad the matter has now come to a conclusion, save for the costs aspects which will be addressed by the tribunal in due course,” a Mishcon spokesperson said in a statement published by the Gazette.

Barrister Chloe Carpenter QC, who acted for Mishcon, said that the violation had been “completely unwitting and unintentional” on the firm’s part, and pointed out that it was Mishcon that had first brought the matter to the Solicitors Regulation Authority in 2017.

Meanwhile, the tribunal dropped the allegations against Ellen, finding that at the time, she had been a “relatively junior solicitor” who “had no power to authorise the payments and that she could not be said to have allowed them,” Spooner said.

“The requests for payments had been made in circumstances where they firstly had to be authorised by the matter partner and thereafter by the authorising partners,” the tribunal chair explained. “The matter partner and authorising partners were each responsible for ensuring that any payments were made in compliance with the solicitors’ accounts rules. In these circumstances, we find that there had been a break in the chain of causation such as it could not be said that Ms Ellen had caused the payments to be made. As such, we find that [Ellen] neither caused nor allowed the payments to be made.”

According to Ellen’s legal representative Richard Coleman QC, Ellen had incurred £507,000 in costs in the process. However, the SDT adjourned decisions on cost applications to a December proceeding.

Ellen is presently a director at Livida Sport.

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