Barristers lose £2.75m

Pump Court Chambers also lose the right to keep alleged fraud secret

How much do top barristers earn? Enough at Pump Court Chambers, it seems, not to notice that their chambers’ fees had gone down by some £2.75m. Admittedly we are talking about chambers with more than 130 members. And the money had disappeared from one of their operating companies’ bank account over a period of five years. But it was still something the chambers had wanted to keep quiet.

I said their money “disappeared” — but that’s not quite right. The barristers say that around £2.75m was taken by their former credit control manager Gillian Goodfield, also known as Gillian Brown. What’s more, she “has accepted the thrust of the allegations against her”, the High Court said this week. “She candidly admitted to her wrongdoing; she had indeed taken the money and now bitterly regretted it”.

Pump Court, Inner Temple, which has given its name to several chambers

The case came before the civil courts when Pump Court Chambers Ltd applied for injunctions to freeze Goodfield’s assets. These orders were granted by Mr Justice Edwin Johnson on 21 August without notice to her. Sitting in private, the judge also granted the chambers’ request for an anonymity order.

On 19 September, there was a further hearing before Charles Morrison, a leading City solicitor who sits as a deputy (part-time) High Court judge. Goodfield was notified and appeared in person at court. The barristers were represented at the hearing by Saaman Pourghadiri, from 4 New Square Chambers.

“The first ground developed by Mr Pourghadiri,” Morrison explained in the judgment he delivered on 25 September, “was that being called upon to respond to the inevitable consequences of publicity would affect the ability of Pump Court Chambers Ltd to conduct these proceedings”.

This was how the judge summarised the chambers’ arguments:

Allowing the matter to become public now, it was submitted, put at risk the integrity of the chambers as a going concern. The result could be something analogous to “a run on the bank”. High-earning barristers might decide to leave before their expenses were increased, something that they might consider a real possibility given the nature and extent of Mrs Goodfield’s wrongdoing.

But this was not the only issue. Former members might make claims for sums unpaid to them, despite not having any continuing obligation to meet the expenses of the chambers. A spiral of decline could thus be the result of members of the chambers arriving at the view that they should not be last to leave.

I was also invited to take into account a likely practical problem that would afflict Pump Court Chambers. Debtors, the preponderance of whom being firms of solicitors, might use the circumstances surrounding the wrongdoing as a reason to delay making payment upon sums properly due and owing to Pump Court Chambers. Such an outcome would merely serve to exacerbate the already painful liquidity problem caused by the actions of Mrs Goodfield.

The problem was serious enough to allow Mr Pourghadiri to refer to it as posing an existential threat.

I should explain immediately that any threat to the chambers’ continued existence has not materialised — or, at least, not yet. It is “business as usual”, the chambers said in a statement on Wednesday:

Pump Court Chambers has discovered it has been the victim of a fraud by a former member of staff. This fraud took place some time ago and did not impact upon the operational running of chambers. Upon discovery we took immediate and decisive recovery action. We are pursuing all legal avenues vigorously. Chambers takes theft and fraud extremely seriously and has put in place new systems to address any future risks.

Please rest assured that it is business as usual for our barristers and dedicated and trustworthy clerks, who remain fully committed to providing the highest standard of service to our clients. We appreciate your continued support during this time.

As the matter is now in the hands of the police, we are unable to comment further at this time.

Pourghadiri could not have been surprised that his reference an existential threat has now become public knowledge. In the judgment he delivered this week, Morrison explained why he had refused the chambers’ request for the hearing — and hence his ruling — to be private:

On the matter coming before me last week for the inter partes hearing, I made it clear at the outset that I was uncomfortable with the notion that the court should again sit in private and that given Mrs Goodfield had now accepted the thrust of the allegations against her, there could be no justification for a continuation of the anonymity order…

I should say that Mrs Goodfield, who was throughout the hearing showing no little signs of distress, made no attempt to resist the orders asked for. Her demeanour was consistent with the approach taken in her written evidence which was that she could not quite come to terms with the scale of her wrongdoing which she could now so very clearly see.

At any rate, I took time to explain the proceedings to Mrs Goodfield so as to ensure that, as best she could, she was able to follow the developing case. That however was a poor substitute for being properly advised by lawyers.

I urged Mrs Goodfield at the outset and at the end of the hearing to seek advice; I reminded her of the availability of legal aid; I suggested that a trip to the Royal Courts of Justice information desk might point her in the direction of free representation units.

Responding to the barristers’ suggestion that publicity would generate a “spiral of decline”, the judge appeared unpersuaded that, as he put it, “sophisticated members of a respected chambers would feel it necessary to seek to practise elsewhere when it was patent that their management colleagues were doing their utmost to recover the proceeds of an alleged fraud”.

The chambers had also argued that there was a risk of tipping off other parties who might have received the proceeds of wrongdoing. Pump Court Chambers “found it hard to accept that what would amount to approximately £700,000 a year had been, as they put it, ‘frittered away’. It was submitted that some funds must still be preserved and a proper opportunity to trace should be afforded.”

But, said the judge, “those acting in concert with Mrs Goodfield” — if there were any — “would have had ample opportunity in the past four weeks to take steps aimed at concealment or dissipation”.

What, asked the judge rhetorically, was the purpose of the hearing?

To my mind the object was not, as was submitted by Mr Pourghadiri, to protect the integrity of the chambers, but rather to decide if Pump Court Chambers was entitled to the injunctions it asked for, along with the disclosure orders.

Would, in these circumstances, a public hearing prevent the object of the hearing being achieved? The orders have been made. Mrs Goodfield’s assets, or perhaps more properly the assets belonging to Pump Court Chambers, have been frozen in her hands.

She must now explain what has become of the money she took; if the funds are now represented by chattels, she must explain what they are and who has them. None of this is prejudiced by the court doing its business, as it usually does, in public.

In conclusion, the judge was “not persuaded that non-disclosure of the party names is necessary so as to secure the proper administration of justice, nor is it necessary in order to protect the interests of Pump Court Chambers.”

Whilst it was appropriate to make such an order at the preliminary stage, he added, “in light of the admissions of Mrs Goodfield, such an order is not now necessary on her account”.

Comment

There is much one could say. In the circumstances, though, it would be better if we didn’t — and that applies to my readers too.