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Fieldfisher has been heavily criticised by a QC for its role in a cataclysmic power struggle which engulfed the Royal Institution of Chartered Surveyors.
The conduct of Matthew Lohn, a partner in Fieldfisher's regulatory practice and its former Senior Partner, was raised in an independent review conducted by Alison Levitt QC.
Her findings have resulted in the resignation of RICS's CEO, its President, the Chair of its Management Board, and the Chair of its overarching Governing Council.
In 2018, one of the Managing Board's non-Executives, solicitor Simon Hardwick, queried a small announcement in the quarterly meeting agenda which noted that the RICS overdraft facility had been extended from £4 million to £7 million as a result of "inaccurate cashflow forecasting". (One of the reasons was "an apparently unexpected £400,000 discretionary bonus paid to the CEO").
A few months later Hardwick learned an audit had been carried out which concluded that "no assurance" could be given as to RICS's internal finance controls, but it had not been disclosed to either the non-Executives or RICS's Governing Council.
When Hardwick flagged that the audit's findings were a serious problem and that its suppression by the Executives represented a failure in governance which needed to be addressed, the Executive team commissioned RICS's General Counsel to produce a review.
Her investigation concluded that there had been no failure of governance and exonerated the Executives, and in November 2019 Hardwick and three other non-Executives who shared his concerns were fired.
When they threatened to take legal action, the Executive team came under pressure from the Governing Council and commissioned Levitt, of 2 Hare Court, to investigate.
Levitt had almost finished her 467 page report in June this year when Fieldfisher belatedly disclosed its file on the matter, which Levitt had been requesting for months.
"Reading it completely changed this report from the one I had been going to write", said Levitt.
She had been led to believe that Fieldfisher's involvement in the debacle was minimal, but its file was huge.
RICS's General Counsel trained under Lohn at Fieldfisher and worked in his team for almost 16 years before taking the RICS role in 2018. It turned out she was still very dependent on her old supervisor. Lohn had, unbenownst to the non-Executives or Levitt, worked extensively with the GC to ghostwrite her review and steer the termination of the non-Executives.
But the GC had not divulged any of that in her interview with Levitt. "Knowing what I now know, I am very surprised that she was not candid with me about their involvement", said Levitt.
The Governing Council had no idea either, even though it was RICS (not the Executive) which was Fieldfisher’s client, and even though Fieldfisher charged RICS £118,677 in a single three month period for advising solely on the issues surrounding the four non-Executives.
Lohn approved of keeping Fieldfisher's involvement secret from the majority of RICS, telling the GC, "No need to explain external resource". Levitt said his attitude was "inexplicable".
She found that Fieldfisher's approach was not just clandestine, but partisan, and that from the beginning it had sided with the Executives against the four non-Executives "without any objective analysis of the true merits of the situation".
Fieldfisher’s priority was that there should be no threat to or criticism of the CEO or the COO, said Levitt.
Proof of its bias included a Fieldfisher document setting out the review's conclusions, which had been drafted before the review's terms of reference had even been finalised.
Records revealed how the GC spoke disparagingly of the non-Executives to Lohn, calling one "not bright enough" and another a "sneaky weasel". But the pair also criticised the Executives for their actions, which Levitt said represented a "private acknowledgement" that they knew their whitewash didn't reflect reality.
The QC said she wanted to ask Lohn why he didn't bother to seek out the views of the non-Executives, but despite initially agreeing to be interviewed, he "then changed his mind", telling the QC that "the documents speak for themselves".
"I agree", said Levitt, taking the prize for Most Elegant Evisceration of a Solicitor.
The COO once stopped a board meeting by bursting into tears when she was asked a question about the audit which she felt called her integrity into question, and when she proposed firing the non-Executives, Lohn embraced the idea.
His eagerness to boot the non-Executives, particularly Hardwick, extended to haranguing an Executive who appeared keener to have a dialogue.
"In the nicest way you have been incredibly indulgent to him", said Lohn, who demanded of his tame GC, "What is the reason for the delay?"
Fieldfisher Head of Employment Richard Kenyon was similarly predisposed to a good sacking. When the non-Executives ended a conciliatory letter by signing off, "we continue to have confidence in the capabilities of our chair, CEO and COO", his interpretation was that it was "dripping in insincerity".
Kenyon advised that the non-Executives could be terminated on one month's notice, but never flagged the chilling effect such an action would have on the other non-Executives or the "immense" reputational damage the move could (and did) inflict on RICS. His advice "was wrong in every respect", said Levitt.
Matters came to a head in an "extraordinary" meeting where Lohn advised the CEO and COO to force the RICS President's hand by threatening to resign unless the non-Executives were fired.
His contribution, "if not amounting to a formal conflict of interest in the regulatory sense" was "deeply unwise", and parts "were not in the interests of Fieldfisher’s client", said Levitt.
In a withering aside, the QC noted that, "With masterly lack of foresight, he had predicted that 'People will have forgotten about this by November'".
Instead, news of the cull leaked to various outlets and Fieldfisher duly threatened them all with legal action.
But the problem grew more absurd when members of the former Governing Council of RICS criticised the actions of the Executives, and Fieldfisher instructed another firm to threaten them late at night with defamation proceedings, too.
"The members of RICS will be very surprised to learn that, in effect, their subscriptions were being used for their external advisers to use a second law firm to send a threatening letter to other members of the Institution", Levitt said.
The members were told to respond by 10am the next morning. There was "literally no prospect of all these surveyors being able to obtain legal advice within the time frame", said Levitt, who called Fieldfisher's "antagonistic, oppressive, and unnecessary" conduct "a bullying tactic" which was "wholly unjustifiable" and "served RICS badly".
Levitt concluded that RICS's General Counsel should not have had a pre-existing relationship with the firm, and that RICS should drop Fieldfisher, which had "more than one potential conflict of interest which they appear either to have ignored or misjudged".
Levitt said it was not for her to say whether Lohn's conduct merited the attention of the regulator. If it does, it will be the second time that perceived conflicts of interest have brought him to the SRA's attention. Lohn was investigated in 2017 for his dual role as both an adjudicator at British Horseracing Authority tribunals and a paid legal advisor of the BHA, which ended with similarly calamitous results.
RollOnFriday is confident he'll receive fair treatment from the SRA. Last time around the regulator dropped its investigation into Lohn just before it accepted his bid to add Fieldfisher to its external panel. At the time, its Executive Director of Case Direction was Juliet Oliver. In a stunning coincidence, before joining the SRA she spent many years working in...Fieldfisher's regulatory practice, under one Matthew Lohn. She is now the SRA's General Counsel.
An SRA spokesperson said, "We are aware of the issue and will gather all relevant evidence before deciding on any next steps", and confirmed that its GC team would not be involved in any assessment of whether or not to undertake an investigation.
In a statement, Fieldfisher said, "We are disappointed to note that some of the actions of the firm and the partners who were involved in seeking to help RICS, in what was an exceptionally difficult time for the organisation, have been criticised. Fieldfisher is committed to upholding the highest professional standards and believe that our partners did so in the overall context of the events reviewed by Alison Levitt QC".
The firm declined to say whether it had reported Lohn, Kenyon, or itself to the SRA, or if it was imposing any sanctions on the partners.
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