Banking and finance: area of practice (barristers)
This area covers all aspects of the business of banks and other financial services providers. Barristers are principally concerned with dispute resolution. Banking disputes can arise from all sorts of transactions, from complex structured finance agreements and derivatives through to consumer loans and bank accounts. The area also concerns the application of Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) regulations.
Clients can be banks based anywhere: a lot of banking and finance business is conducted through London but involving counterparties throughout the world. You could also act for anyone who’s in a dispute with a bank, such as consumers, businesses and governments.
Types of cases
A major case due to go to trial in December 2016 concerns a claim for £4bn brought by groups of investors in the Royal Bank of Scotland (RBS). They allege that they were misled into subscribing for more shares in RBS at a time when its financial state of affairs was less rosy than it was painted as being.
There’s also been a significant amount of litigation in relation to interest rate swaps, with businesses complaining that they were mis-sold these in conjunction with commercial loan agreements. The plunge in central bank interest rates in 2008 meant that swaps often led to massive liabilities for commercial borrowers. In relation to retail banking, the courts have seen ‘bank charges’ litigation and more recently the misselling of payment protection insurance policies.
Lower-level cases can concern the enforcement of loans by banks, or claims under personal guarantees, mortgages, debentures or other forms of security. For example, a county court dispute could involve a high street bank requesting a business to repay a loan and the business claiming that it does not need to.
Be aware of…
Recent landmark cases include Plevin v. Paragon Personal Finance Ltd (concerning powers to reopen unfair credit transactions), AIB Group (UK) Plc v. Mark Redler & Co Solicitors (relating to compensation for breach of trust) and CF Partners LLP v. Barclays Bank Plc (in which a business claimed that its bank had taken confidential information to use for corporate purposes).
Typical disputes last between 18 months and two years. You may have between ten and twenty cases on the go simultaneously. On average barristers at the commercial bar might spend one day in court for every one to two weeks in chambers. However, this may not be evenly spaced out: you might spend several weeks at a time or more in court if you are engaged in a major trial.
You might typically work 50 to 60 hours a week or more. However, the workload is reasonably predictable. You need to be willing to drop your personal plans but there’s a reasonably good chance that you’ll be able to make them! Recession-proof? The 2008 crash generated vast amounts of banking and finance law work, for example around the collapse of Lehman Brothers. By the time litigation from one economic disaster has worked its way through the courts, there’s another on the way.
As a pupil
Pupils typically work 9.00 am to 6.00 pm, occasionally longer. They may take on county court cases in their own right – for example those involving loan agreements. There is a large amount of work at lower levels that offers good opportunities for advocacy in the early years, especially in retail banking. Types of law practised Contract, tort and statutory regulation are the key areas, but you will also need a good understanding of property law and trusts.
MATTHEW PARKER is a barrister at 3 VERULAM BUILDINGS. He graduated from the University of Cambridge in 1995 with a degree in English and was called to the Bar in 1997.