Friday, October 09, 2015

TRIAL BALLOON: Lord Advocate deflects calls for inquiry on Crown Office handling of mortgage fraud allegations against solicitor who represented MP Michelle Thomson

‘Unconvincing’ Lord Advocate raises fears of cover up. DURING one of the worst performances ever by a Lord Advocate before the Scottish Parliament – top prosecutor Frank Mulholland said he did not think there should be an inquiry into the handling of an investigation of a lawyer who was struck off over property deals involving SNP MP Michelle Thomson.

Responding to questions on when the Crown Office & Procurator Fiscal Service (COPFS) was informed of allegations of mortgage fraud involving solicitor Christopher Hales – Frank Mulholland told MSPs that he does not believe there should be an inquiry into when prosecutors knew and how the case has since been handled - after it emerged the Law Society briefly informed the Crown Office of the ‘issue’ in December 2014.

Hales, who once listed his occupation as “Police Constable” – and is now struck off by the Scottish Solicitors Discipline Tribunal from working as a solicitor - handled numerous property deals for his client – SNP MP Michelle Thomson. Mr Hales acted for Ms Thomson before she was elected as an SNP MP.

According to a ruling by the Scottish Solicitors’ Discipline Tribunal, a full version of which has been published by the Sunday Times, Mr Hales failed to provide key information to mortgage lenders in breach of guidelines designed to prevent fraud in numerous cases.

In the Scottish Parliament on Thursday, Labour MSP Jackie Baillie asked Mr Mulholland about the timeline in the case.

During the 10 minute session, Lord Advocate Frank Mulholland presented a timeline of events as the Crown Office saw it:

18 December, 2014 - The issue of solicitor Christopher Hales was raised "informally" by the Law Society of Scotland with the Crown Office. Neither the clients nor properties were named.

28 April, 2015 - The issue was raised again and it was noted that the matter of referral to the Crown Office was still under consideration by the Law Society. Neither the clients nor properties were named.

1 July, 2015 - The Crown was advised by the Law Society that it was required to obtain authorisation from its Guarantee Fund Sub Committee to formally refer the case.

3 July, 2015 - Referral was received by the Crown following the required authorisation. Documents were handed over to the Crown Office and in those documents the names of clients and properties were disclosed.

9 July, 2015 - A formal referral was made to the Crown Office and instructions were issued to Police Scotland.

Frank Mulholland  questioned by MSPs about when the Crown Office was first notified of allegations of mortgage fraud against Christopher Hales.

Mr Mulholland said: "As the Crown has made clear on a number of occasions, the case of Christopher Hales was first brought to its attention by the Law Society of Scotland at a meeting on 18 December, 2014."

Ms Baillie asked if Mr Mulholland believed there should be an investigation into the processing of information between the Law Society and the Crown Office.

She asked if he would order such an inquiry, given that there may have been "additional opportunities for alleged mortgage fraud" due to the delay.

Mr Mulholland responded: "I don't have the power to order an inquiry, and I don't think there should be an inquiry."

He said Police Scotland were instructed to investigate the allegations on 3 July 2015 and formally issued officers to do so on 9 July.

He said the issue was raised at routine quarterly meetings between the Law Society and the Crown Office.

Mr Mullholland said the Crown Office was first made aware on 18 December 2014 that the case was under consideration for referral. The issue was raised again on 28 April.
Image copyright PA Image caption Ms Thomson denies acting illegally

Mr Mulholland added: "The first time the Crown was made aware of the identity of the clients and the properties, was the 3rd of July."

Mulholland was also asked by Jackie Baillie if the Crown Office had begun any Proceeds of Crime actions against those involved.

Embarrassingly for the Lord Advocate, and appearing to have little clue as to the sequence of events, he responded “not yet”.

Police Scotland launched an inquiry only after the Crown Office was finally handed the detailed case files in the Hales case by the Law Society, some seven months from the day it first alerted prosecutors to the case.

Hales was banned from the legal profession in May 2014 over 13 property deals linked to Thomson and her business partners. The transactions involved “back to back” sales, where homes – often owned by vulnerable people – were bought at below full market value and then resold at far higher prices, in some cases on the same day; where large cash sums were transferred between the parties involved; where mortgage loans were sought that were higher than the price paid for the home, and where higher prices than those actually paid were recorded in the Scottish land registry.

Mortgage companies involved in those transactions, including Lloyds, which gave loans through its subsidiary Birmingham Midshires, and Virgin Money, which now owns the mortgage book for Northern Rock, which lent money for one sale, have confirmed they are now in contact with the police.

The Sunday Times disclosed it had submitted new evidence of an unusual property transaction to Police Scotland detectives after a couple who sold a home to Thomson alleged they had £32,000 deducted from the sale proceeds to pay off a loan they had no knowledge of.

The solicitor involved in that transaction, James Craig, had been found guilty of professional misconduct in February 2014 by the Scottish Solicitors Disciplinary Tribunal (SSDT), the body that struck off Hales three months later, and fined £2,500 for breaching money laundering regulations. There was no evidence that Craig acted improperly in the case reported by the Sunday Times.

The Sunday Mail reported that a second lawyer named in the SSDT judgment on Hales called Christopher Tulips, whose firms Strefford Tulips was involved in several deals for Thomson’s firm M&F Property Solutions, had also been censured and fined £2,500 for his role in back-to-back property deals. The published ruling by the SSDT on Tulips is anonymised, so it remains unclear whether his case involved transactions linked to Thomson.

Last week, the Law Society said its director of financial compliance Ian Messer "informally" raised concerns about the case of Mr Hales during two separate meetings with prosecutors in December 2014 and April 2015.

However, the Law Society did not "formally" submit its evidence to the Crown until July 2015, two months after Ms Thomson was elected SNP MP for Edinburgh West.

Law Society chief executive Lorna Jack gave an "absolute and categorical assurance" last week that the election played no part in the timings of the case.

She said Mr Messer would have seen Ms Thomson's name in the unredacted report into Mr Hales but may not have been aware she was a Westminster candidate.

The secretary to the Law Society committee that struck Mr Hales off, Sheila Kirkwood, is said to be a personal acquaintance of Ms Thomson with close links to the SNP.

Lorna Jack has pledged to look more deeply into Ms Kirkwood's links with Ms Thomson, but said she has received an assurance the secretary was unaware of the MP's links to Mr Hales until she read about it in media reports.

Ms Thomson is linked to 13 transactions Mr Hales conducted in 2010-11 where properties were said to have been bought cheaply from clients looking for a quick sale and then sold at a huge mark-up on the same day.

Complicated "cashback" deals were said to have been used to artificially inflate property prices in order to secure bigger loans from lenders.

Ms Thomson has denied acting illegally.Ms Thomson has surrendered the SNP party whip and has also stood down as the party's business spokeswoman at Westminster until the investigation into Mr Hales has concluded.

Previously, First Minister Nicola Sturgeon denied having any prior knowledge of a scandal which led to one of her most prominent MPs stepping down from the party.

During First Minister’s Questions last Thursday, 1 October,  Nicola Sturgeon said in response to questions that "serious issues" had been raised around the conduct of Michelle Thomson. The First Minister said that a police investigation should be allowed to take its course.


The House of Commons Register of Members’ Interests lists 16 SNP MPs as holding property interests from which most receive rental income.

Under the rules, Members of Parliament are required to list a property if (i) its value is over £100,000 and (ii) if they receive rental income of at least £10,000 a year.

Tasmina Ahmed-Sheikh(Ochil and South Perthshire): Three flats in Glasgow and a house in Kingussie, Highlands and Islands (i/ii).

Richard Arkless(Dumfries and Galloway): A house in Broxburn, West Lothian, and a flat in Glasgow (i/ii).

Ian Blackford(Ross, Skye and Lochaber): Croft, including two holiday rental properties on the Isle of Skye (i/ii). A house in Lanark (i),

Deidre Brock(Edinburgh North and Leith): A half share in two Edinburgh flats (i).

Lisa Cameron(East Kilbride, Strathaven and Lesmahagow): A house in South Lanarkshire (i/ii). Five residential and holiday let apartments in Edinburgh and South Lanarkshire (i/ii).

Martyn Day(Linlithgow and East Falkirk): A house in West Lothian (i).

Patricia Gibson(North Ayrshire and Arran): A flat in Edinburgh (i).

Calum Kerr(Berwickshire, Roxburgh and Selkirk): A house in Wester Ross (i/ii).

Chris Law(Dundee West): A flat in Dundee (i) and a flat in Aberdeen (i).

Angus Brendan MacNeil(Na h-Eileanan an Iar): Jointly owns a house in Fort William plus a flat in Glasgow and a flat in London (i/ii).

Stuart McDonald(Cumbernauld, Kilsyth and Kirkintilloch East): A flat in East Dunbartonshire (i).

John McNally(Falkirk): Owns a hair salon, The Barber Shop, from which he receives £600 a month in rent.

John Nicolson(East Dunbartonshire): A terrace house in London’s Tower Hamlets (i/ii). He occasionally receives income for renting it out for photoshoots.

Steven Paterson(Stirling): A half share in a flat in Stirling (i).

Tommy Sheppard(Edinburgh East): Commercial premises and residential property in Edinburgh (i) owned by entertainment company Salt ‘n’ Sauce Promotions of which he is a shareholder.
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Michelle Thomson(Edinburgh West): Two residential properties in Edinburgh, one in Falkirk, one on the Isle of Bute, one in East Calder, one in Stirling, one in Dollar, a half share of a property in Edinburgh and a quarter share of a property in Edinburgh (i/ii). She is a shareholder in the property management firm Your Property Shop.

Friday, July 31, 2015

GENDER INEQUALITY: Scots legal profession in the dock over unfair pay as Law Society research reveals 42% difference in salaries between male & female lawyers

Women in Scots legal world paid less than male solicitors. WOMEN in Scotland's legal profession are being paid significantly less than their male counterparts, with the sector lagging behind other occupations in tackling the pay gap.

Research published by the Law Society of Scotland shows that today marks the point at which some female solicitors begin effectively working for free in comparison to their male colleagues as a result of the disparities.

The findings, published as a think tank warned of a general widening pay gap north of the border, show that the average salary for women in the legal profession is 42 per cent lower than for men, with females earning an average of £32,650 less.

The extent to which salaries of female solicitors lag behind male counterparts – in what has been for years viewed as a boys club world of Scots law firms, must now be tackled head on and a parity must be reached on salaries between equally hard working female solicitors and their male colleagues.

Commenting on the research published by the Law Society, a senior lawyer agreed there was a gender pay gap between male & female solicitors.

He said: “The matter of gender inequality on salaries and – equally importantly - partnership status within law firms must now be addressed to bring the legal profession in line with what we preach to others.”

However, the lawyer said transparency on gender pay must also apply to the institutions of the profession itself – naming the Law Society of Scotland as one example.

Commenting on the position of the Law Society, the senior lawyer said: “Given the Law Society has published this research I am sure the profession and equally the public would like to know how the gender inequality gap affects women working within the Law Society of Scotland as an institution.”

He continued: “Today must also mark the point where the Law Society of Scotland publish the full salaries and expenses of their department directors and senior staff including current Chief Executive Lorna Jack.”

Citing an example of the Law Society’s English Chief Executive, he said: “The £400,000 salary of former Law Society of England & Wales Chief Exeutive Des Hudson was published without difficulty while we as a profession and the public remain in the dark about hefty salaries at the Law Society of Scotland and, I am told, lavish air travel and hotel expenses claims.”

It is rumoured salaries an expenses claims of senior Law Society of Scotland staff and directors have significantly increased over the past decade, with little accountability or transparency.

The solicitor membership who pay annual subscriptions are given little say on Law Society of Scotland salaries and expenses claims – unlike public bodies which have to publish salary scales and hand over detailed information on expenses when requested to do so.

The Law Society’s news release on the gender pay gap in the legal profession:

Tackling the gender pay gap - 42% difference between male and female solicitors 31 July 2015

For some female solicitors, Friday, 31 July marks the point after which they are effectively working for free until the end of the year.

Law Society of Scotland research shows a 42 percent gender pay gap among its members. The figure has been reached through comparing average full time and full time equivalent (for part time/flexible hours employees) salaries for women and men at all career stages.

Janet Hood, convener of the Law Society of Scotland’s Equality and Diversity committee, said: “A 42 percent gender pay gap reflects very badly on what is otherwise a modern and forward thinking profession – with some female solicitors effectively working for free for five months of the year.

“There are many and nuanced reasons why the gender pay gap exists, and the legal profession is certainly not alone – figures from November 2014 show that the overall UK gap was 9.4%. However we have seen little change in the past decade compared to other professions such as accountancy or dentistry so it is a major concern that such a substantial gap persists 45 years after the UK Equal Pay Act and after a decade of Law Society equality research and promoting good practice within the legal profession.

“Quite simply it is not something we can afford to ignore, for either ethical or business reasons.

“Women now represent half the legal profession in Scotland and there should be no limit set on their talent and ambition.

“Employers have legal responsibilities in relation to equality as well as any commercial considerations. They need to be aware of the extent of the gender pay gap within their own organisations and take action to ensure that they meet their obligations and, importantly, work to retain talented individuals who can help their businesses thrive now and in the future.

“Many government and other organisations sourcing legal services also include equality criteria as part of their tendering processes. If law firms are not taking steps to ensure that they are meeting these, they could be adversely affected.”

The Law Society published equality standards, which are currently voluntary, earlier this year. The 10 standards set out that employers should publish an annual statement about the composition of organisational roles, reporting on gender as a minimum, and for organisations with more than 150 staff, publish pay gap figures for full-time and part-time staff at each level of seniority. The Society has also published an equal pay toolkit to help firms do this. 

Ms Hood added: “We introduced the 10 equality standards and the equality toolkit following strong support from the profession for a more prescriptive set of standards to complement our other equality guides. With so many women now entering the solicitors’ profession, it is essential that we continue in our efforts to reduce the gender pay gap and to monitor this generation of solicitors as they progress in their careers.

“I hope that publishing the gender pay gap figures and making them a discussion point will help empower people to ask questions and stimulate further change – and that in another decade we will not see such a significant pay gap between male and female solicitors.”

The research by the Law Society of Scotland has shown that the average gender pay gap within Scotland’s legal profession at specific stages ranges from 2% to 38% and affects solicitors working in private practice law firms and those working in house for other organisations. The findings have shown that in the earlier stages of solicitors’ careers, there is very little difference between male and female solicitors’ earnings. However from age 36 onwards, women generally appear to be paid lower salaries than men of the same age, with women are more prevalent in the salary bands up to £65,000 and men more prevalent in salary bands over £65,000.

The research findings have also shown that women tend to remain associates or assistants rather than be promoted to partner level. While the findings suggest that there is very little direct discrimination in terms of women being paid less for directly equivalent roles and experience, there appears to be an issue around assumptions made about women, with the report indicating that women earn less than their male counterparts whether or not they have children.

In the later stages of a solicitor’s career, the research indicates that there is less of a gap at 32% for solicitors who have been qualified for 21-30 years, and 21% for those qualified 31+ years.  However, this is in large part due to lower male earnings in these age groups, rather than increased pay for women

The research has indicated that career breaks longer than six months are a significant barrier to career progression. Many respondents also considered that part-time working was detrimental to a person’s career, for both males and females, even in firms that were supportive and accommodating of flexible working arrangements.

Some findings have been more encouraging. In comparison to the 2005 Women in the Legal Profession in Scotland report, there appears to have been a move towards childcare responsibilities being viewed as a joint responsibility rather than solely a mother’s responsibility. Women are still largely expected to take time off when a child is sick, although the gap here has also narrowed slightly.

The Law Society plans to publish a series of guides later this year for solicitors returning to work following a period of maternity, paternity or adoption leave and is currently seeking views from solicitors on their return to work experiences.

The Law Society of Scotland has over 11,000 practising solicitor members. As part of its work on equality and diversity within the legal profession the Law Society launched equality standards in February 2015. The UK Government also passed legislation in 2015 that requires larger employers across all sectors to publish gender pay gap figures.

The full equality and diversity research findings are available on the Law Society of Scotland website:

Profile of the profession

We have now launched the findings of the Profile of the Profession. We would like to thank each and every one of the 3,449 solicitors in Scotland who took time to respond to this research. We are very grateful for your time, and this has helped us ensure a statistically meaningful set of results can be published.

We are now moving to the next stage of the project, which involves confidential focus groups and phone interviews to explore some themes from the research in more detail.  For information and the opportunity to volunteer to be involved, please click here.

You can access the full research report and we'd encourage you to look at the executive summary at the start as well as chapters that may hold detail of particular interest.

Slides from launch event are also available.

We also launched updated guidance to help firms tackle some of the issues the research covered. These can be found online by clicking the links below:

Free online leaning has also been made available around some key equality issues. For example, there is an online learning package onbullying and harassment, for firms and for individuals, and have online learning to support making your firm or services to be more accessible to disabled people.

Finally, we're also keen to support solicitors understand these issues. We're delighted to attend or support the preparation of in-house CPD in larger firms and in-house employers. Likewise, we'd be delighted to visit faculties or local CPD groups, or recommend speakers on this topic. You are also welcome to discuss issues with us in private.

For further details on any of the above, please contact

This page will also give you details of:
  1. Why did we do the research?

  2. Who are the researchers and what is the level of confidentiality?

1. Why did we do the research?

This work will update our previous diversity research and quantify how the profile of our members has changed over the last six years. The research also seeks to collect valuable information on current working patterns across the profession and explore views and experiences of a range of equality-related issues. This is a vital project, and helps us respond to government and stakeholders who challenge the profession, as well as help tackle issues our members face. To best serve our members we also need to understand you, who you are, how you prefer to work, and importantly, be able to identify any equality or discrimination issues so that we can address these quickly and effectively.

Previous research led to work to combat bullying, a challenge to improve equal pay, and changes to policy for those entering the profession. Ensuring a large response is critical to guaranteeing the data truly represents our members.

The project was developed by our Equality and Diversity Committee and had been approved by our Board and Council as part of our Equality and Diversity Strategy.

2. Who are the researchers and what is the level of confidentiality?

The survey is anonymous and being administered by an independent research consultancy, MVA Consultancy, who adhere to the Market Research Society's Code of Conduct, and will ensure that your participation and responses are treated confidentially.

The Society will only be provided with a statistical summary and an anonymous report.  Although some of the questions may seem rather personal or sensitive in nature, we need this information both to meet our legal commitments under the equalities legislation and to monitor diversity within the profession.

3. How to find out about findings from previous studies?

All our previous work in this field is available to solicitors and the public from our website.

Our main statistical research includes:

Women in the Profession

In 2005 we examined issues around gender, equal pay and career progression in the profession.

Profile of the Profession

In 2006 we broadened our focus, looking at a wider range of areas, covering all of what are now called the 'protected characteristics'. This research also looked at perceptions around equality in the profession and in the incidence of discrimination and harassment.

Robust Foundations - Changes in Law Society Membership

In 2010 we updated our data on 'protected characteristics' by working with the Judicial Appointments Board for Scotland on research they were doing and sharing the anonymous data. This gave us a second data set. Our new research will give us three reference points, allowing us for the first time to truly comment on emerging trends (rather than providing 'snap shot' data).

Two other pieces of research, both qualitative, have also been carried out in this field:

Preventing Bullying and Harassment - 2011

This drew on the statistical data from previous research on bullying, and used interviews and focus groups to assemble typical 'case studies' of the issues faced by lawyers and then developed materials for tackling these.

The experiences of ethnic minority background solicitors in Scotland

This work also followed previous statistical findings which suggested that despite increasing numbers of solicitors coming from an ethnic minority background, they were significantly less likely to be equity partners than their white colleagues. Interviews explored the issues around this.

Working patterns in the legal profession

Equal pay toolkit – Ensuring fairness, closing the pay gap  The table below shows the average annual salary for each year qualified. It represents full time or full time equivalent earnings (part time actual earnings are calculated on a pro-rata basis to give the full time equivalent). 

Friday, June 19, 2015

Crown Office granted order for cockpit voice & flight data from 2013 North Sea Super Puma helicopter crash

Helicopter crash data to be handed over to Lord Advocate. DURING a hearing at the Court of Session today, Lord Jones granted an order to Scotland's Lord Advocate for access to the black box from a helicopter crash in the North Sea which claimed four lives.

Eighteen people were aboard the Super Puma chopper which crashed into the North Sea near Shetland in August 2013.

Lord Jones said in his opinion : Lord Advocate for an order in terms of The Civil Aviation Regulations 1996 he would make the helicopter's flight data available to the Crown Office & Procurator Fiscal Service (COPFS) and police with conditions attached.

Lord advocate Frank Mulholland had asked the courts to release the black box, in a move opposed by pilot union BALPA.

The judge said: "In my judgement, there is no doubt that the lord advocate's investigation into the circumstances of the death of each of those who perished in this case is both in the public interest and in the interests of justice.

“The data which the lord advocate seeks to recover will provide relevant, accurate and reliable evidence which will enable the Safety and Regulation Group (SARG) to provide an expert opinion of value to assist him in his investigation of the circumstances of the death of the four passengers whose lives were lost, and his decision whether and, if so, against whom to launch a prosecution”

Lord Jones said he accepted that SARG could not provide expert opinion to aid the police and Crown Office which was "of value" without carrying out a flight specialist analysis of the data from the Super Puma which crashed two years ago as it approached Sumburgh Airport in Shetland.

He added: "Accordingly, I hold that those data are strictly necessary for the purposes of the police investigation."

The judge said he was satisfied that disclosure in this case will have no adverse domestic or international impact on the current investigation or on any future safety investigation. He said that although he would order for the transport secretary to make the black box available, conditions would be attached.

They include that Police Scotland will take possession of the data and retain overall control and responsibility for it until it is returned to the Air Accident Investigation Branch (AAIB). He said the results of any analysis would to be treated as confidential and only disclosed to the Crown Office and police.

The helicopter, with two crew and 16 passengers on board, crashed on August 23, 2013, about two miles west of Sumburgh. Sarah Darnley, 45, Gary McCrossan, 59, Duncan Munro, 46, and George Allison, 57, all lost their lives.

The AAIB began an immediate investigation, which is still under way. Seventy-eight hours of flight data and two hours of audio recording were downloaded as part on the inquiry.

It includes communications between the commander and co-pilot, radio transmissions and passenger announcements.But the judge said such recordings also capture "ambient sounds" which may be important to an investigation, such as a change in engine note.

The AAIB has issued three reports over the accident, one of which reported that wreckage examination and recorded data analysis had not shown any evidence of a technical fault that could have caused the accident, although some work remained to be completed.

The lord advocate said that in the apparent absence of any technical fault the police had asked SARG to provide an expert opinion on the performance of the flight crew.A formal request was made to the AAIB to make the data available for the investigation, but it said a court order would be required.

Aidan O'Neill, for the pilots' union, told the court at an earlier hearing that "a culture of openness" was fostered so that when an incident happens complete information can be obtained.

He said there was a culture of sharing information without fear of reprisals.

Lord Jones said accident investigators cannot be required routinely to disclose cockpit voice recordings and such a move can only be ordered in a particular case if the tests laid down in regulations were met. The judge said his decision in the present case would not create a precedent.

Scottish Arbitration lags behind court, says survey from Heather Capital law firm Burness Paull, as hopes for cornering arbitration business fail to materialise

Law Society led arbitration choked up with property & construction disputes. A SURVEY of Scottish Arbitration reveals property and construction disputes continue to dominate the subject matter of arbitrations in Scotland.

The survey also claims initiatives have been taken in sectors usually dominated by smaller high street and rural law firms – such as agricultural and family matters.

Work on the survey was led by the University of Aberdeen and legal firm Burness Paull LLP –  who are currently being sued for millions of pounds over their role in the collapse of the £400 million Heather Capital hedge fund, run by Spanish based Gregory King, originally from Glasgow.

Heather Capital raised hundreds of millions in international finance to lend against Scottish property before going under in 2010. Most of its money has been ‘lost’' to investors, even though the Law Society of Scotland had been keeping an eye on client accounts of certain law firms which appear to have funnelled millions of pounds of money through their client accounts to Heather Capital related entities.

Burness Paull - one of the two biggest law firms in Scotland - is understood to have acted for at least one of the businesses in Mr King's network of companies. King is one of four people currently under investigation by Police Scotland and the Crown Office.

The Law Society of Scotland also gave support to the project without declaring it has a vested business interest in the project and is one of the main sponsors of the Scottish Arbitration Centre – backed by the Scottish Government, the Chartered Institute of Arbitrators, the Faculty of Advocates, the Law Society of Scotland and the Royal Institute of Chartered Surveyors, partially funded by public money.

The survey concludes use of arbitration is in line with expectations following the Arbitration (Scotland) Act 2010, however cases returning to the court rolls appear to indicate Scottish arbitration is failing the grade, and giving false hope to litigants who may secure more advantageous hearings & settlements in the courts.

These are among the findings of the first report of the Scottish Arbitration Survey, covering the period from 1 July 2013 to 30 June 2014. The report provides statistics on arbitrations in Scotland during that period, along with procedural trends and attitudes. It also contains a commentary on the evolution of arbitration since the Arbitration (Scotland) Act 2010, including the role of the courts and the developing scope for the use of arbitration in Scotland.

The research found that around 22 arbitrations with a Scottish seat occurred during the period covered, across a wide range of dispute value. Most employed single arbitrators rather than tribunals; they generally followed the unamended Scottish Arbitration Rules, though there was use of bespoke rules; they adopted various forms of procedure; and they generally reached an award in less than 12 months.

The survey, written by parties with a business interest in expanding the poorly regulated Scottish arbitration business, claim speed, confidentiality, procedural flexibility and technical specialism were seen as potential advantages in using arbitration.

It is intended to follow up the report with further surveys, to provide statistical information on trends over time. The next survey will be undertaken in early 2016 to cover the calendar year 2015.

The organisers said they hoped the survey would provide a valuable resource to arbitrators and practitioners, and to those who promote arbitration. "As well as providing a measure on the number of arbitrations occurring, it provides an insight into attitudes to dispute resolution and to the practice of arbitration that will be helpful to those who practise as decision makers and representatives in the resolution of disputes", they commented. "It will also provide guidance to those who do not participate directly in dispute resolution, but who advise clients on alternative dispute resolution mechanisms, weighing up the important factors in adopting an effective and commercially pragmatic approach.

"Once interested parties have had an opportunity to read the Report over the summer period, we will arrange presentations and discussions on the lessons that might be drawn from the information and statistics collected. Amongst those will be a seminar in November in the Chartered Institute of Arbitrators (Scottish Branch) seminar series.

"We will look at ways to optimise the survey over time, and would welcome any feedback. We are grateful to all those who participated in the survey and hope that you will continue to support future surveys, so that Scotland can benefit from sound statistical data."

Legal insiders continue to maintain litigants can secure more fairer and permanent outcomes using the more accountable courts system instead of relying on closed door negotiations which are often fraught with difficulties and failures of arbiters to declare vested interests in cases before them.

Questionable  arbitration hearings the survey did not cover include instances where -

* an arbitration specialist involved in a case relating to a dispute with a multi national energy company took a payment from the energy company before both sides concluded an agreement. The agreement has now ended up subject to legal action;

* a case of an arbitration specialist failing to reveal her husband was a board member of a company involved in an arbitration she was currently engaged in;

* a recent case where an arbitration expert failed to reveal he was employed by one of the parties involved in an arbitration relating to a multi million pound property dispute.

Thursday, June 18, 2015

Pay now or comply later: Solicitors reminded over deadline to pay up historical client balances or firms may face action from Law Society of Scotland

Solicitors reminded to pay up on squirreled away client funds. THE Law Society of Scotland has issued a warning to law firms that action could be taken against them if they fail to pay out any historic balances of client funds held within the next few months.

Law Society of Scotland practice rules which came into force on 1 November 2011 allowed two years for the clearing down of historical balances, up to 31 October 2013, but the Society's Financial Compliance team, which inspects solicitors' books for compliance with the accounts rules, has come across many firms which still hold historical client balances.

The Society believes that firms have had ample time to comply with the rules and has now contacted all firms to set a deadline of 31 October 2015 for completing the work required to disburse all client balances held following the conclusion of transactions. From that date, any ongoing rule breaches relating to these balances will be reported to the Guarantee Fund Subcommittee.

The practice rules require every practice unit to disburse client credit balances promptly following conclusion of transactions, and to remedy any breach of this rule promptly on discovery. The cashroom manager is responsible for securing compliance with these obligations, but it is possible that other solicitors in the practice could be deemed to have caused or knowingly permitted the practice unit not to comply with the rule, which would also permit action to be taken against them.

A release from the Law Society of Scotland said: We are now urging all firms to fully complete the work required to disburse all client balances held following conclusion of transactions by 31 October 2015.

From that date, any ongoing rule breaches relating to these balances will be reported to the Guarantee Fund Sub-Committee

The Law Society’s Financial Compliance inspection team have been working with many firms and monitoring progress being made with the required work. They have determined that an additional two years from the date of the rule requirement is ample time for this to be completed.

Law Society of Scotland practice rules

B6.11 Failure to disburse client credit balances following conclusion of transactions

Under the terms of the Law Society Practice Rules 2011, Rule B6.11 requires every practice unit to disburse client credit balances promptly following conclusion of transactions.

In addition:

* Rule B6.4 requires a practice unit to remedy any breach of rule 6 promptly upon discovery.
* Rule B6.13 states that the cashroom manager is responsible for securing compliance by the practice unit with the obligations of rule 6.
* Rule B6.2.3(b) states that no regulated persons (solicitors) within the practice unit shall cause or knowingly permit the practice unit not to comply with any provision of rule 6, therefore it is possible that the Guarantee Fund Sub Committee will take the view that other solicitors within the practice unit are responsible, and action may also be taken against them.

If you have any questions, please do not hesitate to contact the Society's financial compliance team.

Tuesday, June 09, 2015

Police Chief & Sheriff clash over ‘cover up culture’ within Police Scotland as top cop slapped down by judge over attempt to interfere with judiciary

Top cop slapped down for interfering with sheriff. CHIEF CONSTABLE Sir Stephen House – in charge of Scotland’s single Police service Police Scotland  has been ‘slapped down’ by a senior judicial figure amid allegations he attempted to interfere with the role of Scottish Sheriffs.

Chief Constable House demanded a meeting with Scotland’s Sheriff Principal Brian Lockhart to voice his anger at comments made by Sheriff Robert H Dickson - who suggested a cover-up culture may exist within Scotland’s single Police Force.

However, after an angry exchange of letters between the two, Sheriff Principal Lockhart refused to meet with the top cop – and then went on to accuse Chief Constable House of failing to “recognise the role of the judiciary”.

The spat between Scotland’s most senior Police Officer and a senior judge was reported by 'The National' newspaper earlier today.

The row erupted after a case at in December at Airdrie Sheriff Court, which prompted Sheriff Robert H Dickson to jail PC David Carmichael for seven months after he was convicted of lying to protect a colleague who was drunk driving.

The row between Scotland’s top cop and members of the judiciary erupted after a case at in December at Airdrie Sheriff Court - which prompted Sheriff Robert H Dickson to jail PC David Carmichael for seven months after he was convicted of lying to protect a colleague who was drunk driving.

In his sentencing, Sheriff Dickson said the evidence “suggests that there may be a perceived culture that police officers are willing to prevent the arrest and prosecution of a colleague”.

He added: “If that culture exists, then every superior officer and anybody involved in the training of the police must ensure that it is stamped out forthwith.”

Chief Constable Sir House – angered at the comments of the sheriff -  demanded a meeting to discuss the case with Sheriff Dickson’s boss – Sheriff Principal Brian Lockhart, but was rebuffed.

In letters, House criticises Dickson for raising concerns about Police Scotland’s integrity in public and says he should have raised them directly with the police or through the Sheriff Principal.

But Sheriff Principal Lockhart wrote back to say: “Sheriff Dickson was entitled to draw from the facts before him that this cover-up may not have been a one-off incident”.

Sheriff Principal Lockhart added there is “ample evidence” to support Sheriff Dickson’s claims: “These were carefully phrased expressions of concern, justified by the evidence in the case before him.”

The sheriff said Dickson had every right to make the remarks, in order that “public confidence in the judicial system is not further damaged. To suggest otherwise fails to recognise the role of the judiciary”

He continues: “The integrity of the police force is not merely a matter of concern to senior police officers but to us all.”

The case related to in incident in 2010, when PC David Carmichael and fellow officer, probationer PC Justyna Niedzwiecka responded to a call about a drunk driver in Coatbridge, who turned out to be PC Daryl McKillion.

Instead of breathalysing the drunk policeman, Carmichael radioed in to control to say that nobody had answered the door.

Niedzwiecka reported the matter to a senior officer.

The call about McKillion had come from an off-duty detective who had seen the PC buy a bottle of whisky and get into a car.

McKillion, who was suffering from severe depression, took his life three weeks later.

Professor James Chalmers, Regius Professor of Law at the University of Glasgow, said House was attacking the messenger.

Chalmers said: “It may only be a problem of perception, but that’s still a real problem which he has a responsibility to do something about. The problem seems to be one of perception within the force rather than more generally, so there’s no room for the argument that the sheriff was making the problem worse by speaking out publicly.

“On the plus side, it’s good to see the independence of the judiciary defended so robustly, which is particularly important now that we have a single police force”.

Former policeman and Scottish Parliament Justice committee member John Finnie MSP defended Sir Stephen: “It is important there is a frank exchange of views. The independence of the judiciary must be guarded in any liberal democracy. I well understand the chief constable’s spirited defence, because the overwhelming majority of police officers act with integrity.

“In this case the standards were dropped and I don’t think the chief’s comments were at all unreasonable.”

A spokesperson for Police Scotland said: “The correspondence clearly sets out the chief constable’s rejection of the claim that such practice may have been widespread and his personal condemnation of any officer who wilfully neglects their duty and that all members of Police Scotland are expected to maintain the organisation’s highest professional standards.

“It also clearly sets out the respect for the independent role of the judiciary but does express concern that the original comments by Sheriff Dickson could have been misconstrued”.

Amid calls for a statement on the matter from Lord Justice Clerk Lord Carloway – who is currently acting Lord President – the Judicial Office refused to give any further comment.

Police Scotland was created by the Scottish Government in early 2013 after local policing across Scotland was scrapped in favour of a more easily ‘controlled’ and now highly politicised policing service steered by PR driven headlines to assist Scottish Ministers increasingly dodgy claims regarding crime statistics.

The current make up of the force – which has been subject to budget cuts, loss of key staff & has rumblings of low morale among  officers - has recently hit the headlines over alleged bullying within it’s ranks, the dodgy crime statistics, alleged targets for certain types of crimes, and support for questionable changes in the law backed by headline grabbing politicians and dodgy Crown Office prosecutors out to fiddle their own conviction rates.

Wednesday, June 03, 2015

Crown Case KO’d in Coulson Trial: Collapse of multi million pound perjury trial of Andy Coulson raises questions for Lord Advocate & calls to reform ‘institutionally corrupt’ Crown Office

Andy Coulson exits court after trial collapse. THE perjury trial of former News of the World Editor & No 10 adviser Andrew Coulson sensationally collapsed today after trial judge Lord Burns ruled there was no case to answer.

Now, Frank Mulholland - Scotland’s Lord Advocate in charge of the Crown Office & Procurator Fiscal Service (COPFS) - faces questions over the millions of pounds of taxpayers money spent investigating & prosecution the perjury case – which – according to the ruling handed down by the judge - should not have ended up in court.

The Crown alleged that Mr Coulson, 47, lied about his knowledge of phone hacking at the now-defunct tabloid.

However, the case against him collapsed after his defence team successfully argued there was no case to answer.

Judge Lord Burns ruled the Crown had not shown Mr Coulson's evidence was relevant in the Sheridan trial.

Speaking outside the High Court in Edinburgh after his acquittal, Mr Coulson said: "I am obviously delighted by the judge's decision today. It was the right decision.

"This prosecution was always wrong. I didn't lie and the prosecution, in my view, was a gross waste of public money.

"I am just delighted that after four pretty testing years that my family and myself have finally had a good day."

Explaining his ruling, Lord Burns told the jury that perjury was the giving of false evidence under oath which is relevant to the issues in that trial.

He said the Crown needed to prove that Mr Coulson's allegedly false evidence in the 2010 Sheridan case was relevant to the issues in that trial, and that was for him as a judge to decide rather than the jury.

Lord Burns said that after two days of legal submissions the Crown had not satisfied him that Mr Coulson's evidence had been relevant.

The judge formally acquitted Mr Coulson on Monday, but the acquittal was suspended and could not be reported until Wednesday morning while the Crown decided whether it would appeal.

Clive Goodman and James Weatherup gave evidence at the trial

No appeal was made, and Mr Coulson was cleared more than three years after he was first charged.

The explanation to the jury given by Lord Burns:


I have acquitted the accused of the charge of perjury which he faced and that means that you will not have to return a verdict on the charge in the indictment.

You heard 5 days of oral evidence in the crown case. You have attended and then been sent away repeatedly since the end of the crown case last week and, during that time, what has been happening in this court has, quite deliberately, been kept from you, although you, as jurors, are the most important people in this room. You deserve an explanation of what has been going on. That involves going into some of the issues I have been discussing with Counsel in your absence.

As jurors you were responsible for the facts, I for the law. You were to decide whether the crown could prove that the accused committed perjury during Mr Sheridan's trial in 2010. I was to tell you about the law of perjury. I need to do so now, albeit briefly, to explain to you what has happened.

Perjury is the wilful giving of false evidence under oath or affirmation in judicial proceedings. An oath or affirmation binds the witness to tell the truth. If he gives evidence in a criminal trial or in civil proceedings which he knows to be false and which was relevant to the issues in that trial or civil proceedings, he is guilty of perjury.

Relevant means relevant either in proof of the charge against the accused in that trial or in relation to the credibility of the witness. Unlike the falsity of the evidence, the question of its relevance is a matter of law and therefore for the judge to decide on that matter and not the jury.

To prove the charge against Mr Coulson, the crown needed to prove that:

1 the accused gave evidence in court on oath at Mr Sheridan's trial. There was no dispute about that.

2. that he gave evidence that he knew to be false: that was to be for you to decide. A jury question

3. finally that the allegedly false evidence given by Mr Coulson was relevant to the issues which arose in Mr Sheridan's trial for perjury or Mr Coulson's credibility in the important evidence he gave at that trial. That was the matter of law for me. A judge's question. Relevancy is always a judge's question. Because it was a matter for the judge in the Sheridan trial, now that trial is over but is the subject of this trial, the relevancy of questions and answers in the Sheridan trial was a matter for me in this trial.

In 2010, Mr Sheridan had been on trial for perjuring himself when he gave evidence in the civil proceedings in his action for defamation against the News of the World. So the question of relevancy for me was whether the alleged false evidence given by Mr Coulson in that trial was relevant to the proof of Mr Sheridan's perjury or relevant to Mr Coulson's credibility as a witness in the perjury trial of Mr Sheridan. You will recall that Mr Coulson said in Mr Sheridan's perjury trial that the person speaking on a video tape was Mr Sheridan.

After two days of legal submissions last week and having considered the matter, I decided that the crown had not led sufficient evidence to satisfy me that the allegedly false evidence was relevant to proof of the charge in Mr Sheridan's trial or to Mr Coulson's credibility at that trial. 

There are various reasons given for that in my opinion which I don't need to go into now. But, if you want to read it, you will be able to access it on the Scottish Courts website shortly. Once discharged as jurors, you are allowed to do this sort of research.

So, after the crown case had finished last Tuesday, Mr MacLeod argued that the evidence set out in the charge page 1 of the indictment, even assuming it was false, was not relevant in the way that I have explained and so the accused could not be guilty of perjury. Not every lie amounts to perjury.

I was invited to acquit the accused on the basis that there was no case to answer. The Advocate Depute made submissions in support of the contrary position.

That debate took place on Wednesday and Thursday of last week. On Friday I asked you to come back on Monday since I needed some time to consider and decide the matter. On Monday, before you came into court, I issued my decision which was that the allegedly false evidence was not relevant in the trial of Mr Sheridan and that therefore the accused should be acquitted. So even if you answered your question by saying yes he lied, I would have had to answer my question: No. the lies were not relevant and do not amount to perjury. I therefore acquitted him on Monday.

When a judge does that, the Advocate Depute the right to ask for 2 days to consider whether to take an appeal against the decision to the appeal court. He made that request and I was required to suspend the acquittal in case the crown did appeal. Any successful appeal would have required you to resume your duties and to hear any defence evidence, speeches and my directions before considering your verdict.
The Advocate Depute was entitled to ask for that time I granted it. It meant that I had to ask you to return today.

The 2 day period has now elapsed. The crown do not propose to exercise their right of appeal. That means the accused is entitled to be acquitted.

During all this time it was essential that you, who might yet be required to consider and return a verdict on the charge, were not aware of any of this procedure or what was being said, in case it might influence you in any way, if the trial proceeded. So the press and all branches of the media were prohibited from publishing and reporting on the debate and the result. As is to be expected from responsible media organisations, no such information has been published or broadcast.

All this means that the trial is now over and you will not need to reach a verdict on the charge. I can discharge you.

But before I do so, I would like to thank you for the time you have devoted to the case and the attention you have paid to it. It is appreciated that jury service, even in a normal case, is a disruptive and a difficult task. This particular case has certainly been disruptive for you. But jury service is one of the most important public duties any citizen can perform. I am now able to discharge you and you go with the thanks of the court.

In the wake of the collapse of the Coulson trial, the Crown Office also announced it was dropping charges against the News of the World’s former Scottish editor Bob Bird and  senior reporter Douglas Wight.

The Crown Office said on Tuesday that, after "an extremely thorough investigation of these allegations", no criminal proceedings would be taken against either Mr Bird or Mr Wight.

This marks the end of charges brought as a result of the multi million pound Operation Rubicon, launched by Strathclyde Police in 2011 to investigate allegations of misconduct at Sheridan's trial. As a result, in 2012 seven Scottish police officers detained the former editor at his home in Dulwich, South London at 6.30am and drove him to Glasgow. Shortly afterwards he was arrested and charged.

Operation Rubicon’s English equivalent -  "Operation Elveden" run by the Crown Prosecution Service similarly collapsed. , costing the public over £20 million.

An urgent review of the £20 million investigation was ordered last month, after the Court of Appeal quashed the conviction of former News of the World reporter Lucy Panton, who was the first reporter to be found guilty.

Nine out of the remaining twelve prosecutions against journalists – which included Andy Coulson - have been dropped by the Director of Public Prosecutions, and the entire operation branded an expensive taxpayer funded political witch hunt against the media.

Four more reporters were cleared at the Old Bailey of bribing public officials, taking the total number found not guilty by a jury to 14


The timeline of the latest case against Mr Coulson can be traced back to 2006 when Mr Sheridan won a defamation case against the News of the World.

The politician was awarded £200,000 in damages over a series of articles in the newspaper that claimed he was an adulterer and had visited a swingers club.

In 2010, Mr Sheridan stood trial, accused of perjury in the 2006 case. He was subsequently convicted and jailed for three years.

While conducting his own defence during the trial, Mr Sheridan called Mr Coulson as a witness.

The evidence the journalist gave at the High Court in Glasgow on 9 and 10 December 2010 later prompted the Crown to accuse him of perjury.

The charge against Mr Coulson alleged that he committed perjury when he told Mr Sheridan's trial that he had not known about phone hacking at the News of the World until the arrest of the now-defunct tabloid's royal editor Clive Goodman in 2006.

During Mr Coulson's perjury trial, the Crown led evidence from Mr Goodman and fellow former News of the World journalists Neville Thurlbeck and James Weatherup, who are all convicted phone hackers.

After hearing the prosecution evidence, the jury of nine men and six women was sent from the court last week as defence advocate Murdo MacLeod QC outlined an argument that there was no case to answer.

Mr MacLeod noted that both Mr Sheridan and the Advocate Depute both said in their closing statements at the 2010 trial that the phone hacking testimony had little relevance to Mr Sheridan's defence.
'A shambles'

Responding to the acquittal, a Crown Office spokesman said: "Andrew Coulson was a defence witness at the trial of Tommy Sheridan. He gave his evidence without objection as to relevancy.

"The Crown indicted Coulson on the basis that he lied during parts of his evidence, in particular that he had no knowledge of phone hacking.

"The trial judge in the Coulson trial, at the conclusion of the prosecution evidence, ruled that this evidence was irrelevant and therefore could not found the basis for a prosecution for perjury. This brings proceedings to an end."

Reacting to Mr Coulson's acquittal, Mr Sheridan accused the Crown Office of "corruption" , presiding over "a shambles" and called for someone's "head to roll".

Wednesday, May 13, 2015

Scots Crown Office prosecution of journalist Andy Coulson moved for third time, four week trial expected to cost more than £2m over perjury allegations in Sheridan case

Coulson trial date moved for third time. THE TRIAL of Andy Coulson, the former editor of the News of the World, for alleged perjury is due to start this Friday 15 May 2015 after being moved several times.

The trial - HMA v Andrew Coulson – is the only case resulting from a multi million pound Scottish Police operation condemned “Operation Rubicon” .

The trial is expected to last up to four weeks and cost taxpayers more than two million pounds.

Coulson, who went on to become David Cameron’s director of communications after leaving the News of the World, is accused of lying on oath during the trial of Solidarity party leader and former MSP, Tommy Sheridan, for perjury in Glasgow in December 2010. Sheridan was later convicted of perjury and sentenced to three years in prison.

Mr Coulson denies all of the charges against him

Scotland's Judicial Office initially said: "The trial diet in the case of HM Advocate v Andrew Coulson, previously set for Monday 11 May 2015, has been adjourned. The case will now call at 10am on Tuesday 12 May at the High Court in Edinburgh (Lawnmarket Court 3), to deal with any outstanding procedural matters and to fix another date for the trial to proceed."

The Judicial Office then updated their statement with another change of date: "A new trial diet in the case of HM Advocate v Andrew Coulson has been fixed following a hearing at the High Court in Edinburgh. The case will call at 10am on Friday 15 May 2015 at Edinburgh High Court (Lawnmarket Court 3).”

Coulson, the former editor of the News of the World who became Downing Street director of communications after Cameron came to power in 2010, was due to face a jury during the last weeks of this year's general election campaign, however legal argument led to the case being postponed until this week, removing a potential political embarrassment for the prime minister before the polls closed.

Coulson is charged with three counts of perjury relating to testimony he gave in the 2010 trial of Scottish politician Tommy Sheridan. The former News International journalist, who was working for Downing Street at the time, was called by the defence to answer questions about his role at the now defunct News of the World and his knowledge of the illegal interception of voicemails carried out by the newspaper's staff while he was editor. Sheridan was later convicted of perjury and sentenced to three years in prison and Coulson resigned from the government a month later.

In the wake of the 2011 phone-hacking scandal, Strathclyde Police launched "Operation Rubicon" to investigate allegations of misconduct at Sheridan's trial. As a result, in 2012 seven Scottish police officers detained the former editor at his home in Dulwich, South London at 6.30am and drove him to Glasgow. Shortly afterwards he was arrested and charged.

Also facing legal action are the paper's former Scottish editor Bob Bird and  senior reporter Douglas Wight. However Lord Advocate Frank Mulholland of the Crown Office & Procurator Fiscal Service (COPFS) has not announced any decision on whether prosecutors will proceed in the remaining two cases.

A similar operation run in England & Wales by the Crown Prosecution Service called "Operation Elveden", costing the public over £20 million has all but collapsed.

Nine out of the remaining twelve prosecutions against journalists – which included Andy Coulson - have been dropped by the Director of Public Prosecutions, and the entire operation branded an expensive taxpayer funded political witch hunt against the media.

Four more reporters were cleared at the Old Bailey of bribing public officials, taking the total number found not guilty by a jury to 14

An urgent review of the £20 million investigation was ordered last month, after the Court of Appeal quashed the conviction of former News of the World reporter Lucy Panton, who was the first reporter to be found guilty.