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The Currency – Philip Lee in conversation with Ian Kehoe


Tuesday, October 15, 2019

As published in The Currency, October 9th 2019.

Photo: Bryan Meade

“There was a gun on the table and $10,000 in my pocket. This was not normal legal work.”

His career has spanned everything from commercial trade disputes involving bananas to helping Ryanair secure injunctions. And, Philip Lee has also built a major law firm from the ground up. In this major interview, Philip Lee, the lawyer behind the eponymous law firm explains:

  • How he helped Fyffes stake a foothold in the Latin American banana market
  • “AK47s on ships and bodyguards”: the risks to his personal safety in Honduras
  • Banana wars: his central role in the world’s largest trade dispute
  • Why Ireland has lost the plot in terms of compensation culture
  • Why he decided to set up his own firm
  • How he actually wrote the book on procurement law
  • Why barristers and solicitors should be merged into one profession
  • How the law can vary depending on the judge
  • Politics and Brexit: his plans for the future.

Ian Kehoe (IK): I am talking to Philip Lee, the lawyer behind the commercial law firm Philip Lee. Now, we are going to talk about lots of things today. We are going to talk about building a law firm from the ground up. We are going to talk about strategy in terms of market sectors and geographies. And we are going to talk about the legal landscape in Ireland, particularly within the context of Brexit. But before we get to all of that. I want to start with something completely different. I want to talk about bananas. Because your big break came from the international trade dispute between the colonies and Latin America over bananas. How on earth does an Irish lawyer end up there?

Philip Lee (PL): I’ll give a little chronological background. I had been working as a lawyer in Shell and then as a manager with Shell International Trading Company in London for several years. I was renting oil refineries around the globe. All very exciting, but there was a part of my brain that missed being a lawyer. So, I did some thinking and decided to go back to law. I joined a law firm in London called Bristows. I was working there when I got a call from a friend of mine in college, David McCann, of the Dundalk famous McCann family of Fyffes bananas.

David and his family had difficulties. They had put a foothold into Central America – the first European company ever to put their toe into the hotbed of American multinationals from where they produce bananas. The reaction was not very favourable. There were literally militia with AK 47s coming on to their ships, detaining them in the port and throwing bananas into the sea. It was fraught and, in retrospect, very dangerous.

IK: What year are we talking about here?

PL: 1989. David asked me would I consider leaving my law firm and coming on board for three months to try and solve some of the problems, particularly in Honduras. Being a naïve, excitable young man, the thought of travelling off to Honduras for three or four months, being quite well paid for it, and trying to solve these problems using mainly my European background appealed. I had been in the College of Europe in Bruges and I had a good understanding of competition law. I figured competition law and using the European Communities emerging trade laws would be fundamentally important. So, I jumped at the chance and off I went to Honduras.

I remember the very first trip out there – two things struck me being a naïve young lawyer. First, I was given a wad of $10,000 because you never quite know what you might come across. That was a large sum of money to put in my back pocket to look after my emergencies. Secondly, when I met the agent in Miami who was trying to help them get a foothold in Honduras, he met me in the Miami Marriott Hotel, and he put a revolver on the table. In Ireland you are not used to guns. As a young lawyer to face these two things, you know it is going to be a bit different.

IK: Well, you are sitting there with ten grand in your pocket and a gun on the table.

PL: I knew it was a bit different to the normal legal work I was doing, and it certainly was.

IK: The dispute itself was massive. When it hit what is now the WTO, then GATT. It was the biggest dispute ever.

PL: It was huge. To put it in a chronological context, after we sorted out the problem of getting the European company a foothold in the dollar bananas areas like Honduras, Guatemala and Colombia, in ‘91-’93, everyone became very conscious of the impending fundamental change to the import rules throughout the European member states created by the single market. Bananas from the ex-colonies were more expensive and they were smaller bananas compared to the dollar bananas of Honduras, Guatemala and Colombia. They (dollar bananas) were a slightly lower price because they were produced on large plantations as opposed to mountains. The thought the American companies had when the Single Market came was that they would swamp Europe – take over France, Britain, Spain and Italy, which predominantly brought in bananas from the colonies.

I was involved with Fyffes to try and create rules that would protect both sources of bananas, particularly the ones from the colonies. So, we devised import rules which meant you had to bring in some colony bananas if you were to import the dollar bananas. Those rules were absolutely detested by the Americans, so they talked to the other countries and in a way supported Guatemala and Colombia in initiating a major GATT dispute challenging the legality of those rules. That case came to an end and the Americans were partially successful; but the outcome of the GATT dispute was very much flexible, a negotiated right to talk about a solution.

There were no hard rules of law applicable under the GATT rules. Then the WTO came on board; almost the first major case in the WTO was the banana case. I tendered to work for the African Caribbean Pacific countries, 77 different countries. About eight or ten were directly affected by the proposed challenge. So, my firm plus a US law firm I had worked with and a French law firm I brought in, we were representing the 77 countries, in what was then, and still is, the largest ever trade dispute. There were 148 countries represented and it is one of the biggest cases because it created new provisions in law.

IK: It must have been very exciting as a young lawyer – to experience Honduras and the international trade dispute?

PL: It was absolutely extraordinary. These are the dramatic things about it. I would have had a bodyguard with me every day in Honduras. He was an ex-special forces guy, a tremendous guy. I would innocently go out for a jog and he would follow me everywhere I went. I did not feel under danger. But he was killed after the dispute ended as was the head of the banana growers with whom I mainly negotiated. I won’t get into how this came about but certainly they were threatened this would happen to them and it did happen to them. It was very upsetting when it happened. I have no idea of the cause nor could I speculate but it was very real and very unusual for a young lawyer to be involved in that.

 

Striking out: the decision to set up the firm

Photo: Bryan Meade

IK: You are doing well. You have been involved in large cases. When did you make the decision to set up your own firm?

PL: I was based in London and I met Una, my then girlfriend and my now wife. I wanted to have more of a presence in Ireland. I had written a book on European procurement rules. Everyone knows about public procurement now, but no one knew about it in the early nineties at all. Quite frankly, most large Irish government contracts, some of them were a nod and a wink. The rules of transparency did not really exist. I had written the first book in English on that topic. I had a choice. I was in dialogue with one of the larger Irish law firms and I knew I could have joined them. But I have never been good with authority and the idea of me reporting to someone was not something I was terribly comfortable with. The idea of having a shot in trying to do something different and operate something that was very specialist.

“I think there is that maverick streak or entrepreneurial streak that is inherently in me. I do not think of myself as a businessperson but I always wanted to do my own thing.”

I reckoned if I earned 50,000 a year, that would be enough to live off. If it was not working out I could probably close it down and move into a larger firm. It was a small risk to take and Una was supportive. She was, at that stage, working for an advertising agency, so I could rely upon her.

IK: Were you entrepreneurial at the time? Was there a bug in you to do it? Did you want to grow something?

PL: My father was an entrepreneur, he worked for himself. All my siblings work for themselves in one way or another. I think there is that maverick streak or entrepreneurial streak that is inherently in me. I do not think of myself as a businessperson but I always wanted to do my own thing. As you prod my thought process, I distinctly remember being in bed in London, where I was in a very nice rented accommodation by Shell, and having a vision of me, ten years hence, in my own law firm with nice books on a book shelf and me being respected in an area of law. That goes back even before I decided to do my own thing. That germ was in my head for some time.

IK: I will come to the journey of the company in a moment. But procurement law – did it stem from the trade dispute or was it something completely different?

PL: In a way completely different. I always liked competition law. In fact, Shell probably recruited me because the tools of competition law were very useful for an enterprise that interfaced with the state a lot in Ireland. I also was trained by a very brilliant lawyer called Max Abrahamson, father of Lenny Abrahamson, the very famous film director. Max was absolutely unique and was a complete global specialist on construction law. So I had a background of competition law and construction law and they actually interface in the area of public procurement, because public procurement affects major construction projects but it is also about bringing competition into the field of tendering. There was a natural fit. I was involved in both those areas. I was reading the new directives and I was saying that they were absolutely huge. This was in the mid to late ‘80s. I said that when this becomes law, it will affect everybody. It was enormous and a real game changer for society. I said I should be writing about it and I was in the local trade journals, and so I wrote a book.

IK: Was it a huge part of your practice?

PL: A huge part.

IK: And is it still today?

PL: We have the biggest procurement construction team in the country by quite a way and have been involved in every single large-scale infrastructure project. I moved from bananas to sewage. The first big project was the €400 million Dublin Bay sewage plant that was quite a complex construction project with multi-phases and we put that through all large procurement process. It was the time of the cohesion funds coming into Ireland. So not only was there new law on the table but the European Commission would look at the project they had funded and if they thought there were irregularities in the procurement, they would subsequently withdraw the funding. The risk for a public body to get the process wrong on a European funded project was large. I was the only one in the country at the time who was doing that area of law so I got brought in on loads of big projects.

 

Scaling up: how the firm kept on growing

IK: Ireland is littered with small solicitors’ practice and firms. And they do a good job, have a good business and deliver a good service. But was it always the ambition to build something more?  Because you have built a top 20 firm from the ground up in terms of size and numbers. How did you go about doing that?

PL: There was one crossroads I look back at quite often, particularly in the world of Brexit. Having done, as an advocate, pleading in the WTO, I did think seriously of opening an office in Geneva with a particular Colombian lawyer I was working against. I thought I could be a total specialist in the WTO area. At that particular stage, I knew more than any lawyer in a private practice in the world because I had worked very hard on the case for a long time. The procurement world caught me and Ireland was expanding and work kept on landing on my desk for large infrastructure projects. We needed more people to come on board. I began, one by one, to take people on board. I was really lucky that the early people who joined me like Damian Young and Jonathan Kelly were very unusual, very exceptional lawyers. They were in a league of their own, that gave the firm a substance beyond my own skill. I never thought of myself as a brilliant lawyer, but I was able to get into areas that no one else was involved in. So I looked brilliant by being the only one. That is a really good key – to foresee for clients what areas of law they will be interested in and get into those areas. It disguises your ability as a competent lawyer because you are the only one they can go to.

IK: But it takes a certain level of guile and skill to see the future?

PL: When I was in Shell International, there was one job they could have offered me and I would have stayed. That was a scenario builder. They brought in science fiction film producers, philosophers and others into a team to predict what the world would look like in five, ten or fifteen years and I have always loved trying to foresee what the world is going to look like. That is still a passion of mine. Where are we going with populism? Where are we going with Brexit? Those things do really, really interest me.

IK: Give me a sense of the size, the scale and what areas the firm has really focused in on.

PL: We are quite unique. If you look at the listings of lawyers who are experts in their field, per capita we have more experts than any other law firm. So we dominate the area of procurement construction. We are now bringing in a woman called Angelyn Rowan, who is an expert in the area of development contracts. We focus on media, in terms of film finance. We have been the Data Protection lawyers since the agency was created. We are the lawyers to the FOI Commission, lawyers to An Bord Pleanala. So, planning, environment, data protection, IP, procurement, European competition law – there are a large number of areas where we think we are unparalleled – the bigger firms might say they are just as a good but we say we are the best.

“In my heart I am a lawyer. I love being a lawyer. I love the thinking behind law, I love analysing law. But I think I have reasonably good soft skills.”

IK: But you are not trying to compete in every area, so you want to be the best in the areas where you compete?

PL: Correct. But if we get into an area, we want to be number one. We add the areas bit by bit. At one stage we had a really brilliant planning lawyer who I thought was the best. There was not enough work flowing in so I got the person who I thought was also the best, so we now dominate the area. There is no doubt we are the strongest in planning and environment.

 

The business of law

Photo: Bryan Meade

IK: Leading the law firm is an interesting area – you are the CEO, chairman, it is a multifaceted position. How do you manage that?

PL: With difficulty. In my heart I am a lawyer. I love being a lawyer. I love the thinking behind law, I love analysing law. But I think I have reasonably good soft skills. I read clients and I read the opposition in a dispute reasonably well. Maybe I learned this from working for a multinational, but I believe in teams and in collaboration and I believe in creating units where people are fulfilled in their jobs. People join us because they like our clients, they like the area of law and we will try and protect them and support them. Being a lawyer is a stressful job. We try to get a real team atmosphere, where when someone is under really pressure, their colleagues will recognise that, or their boss, and they will try to support them. We don’t succeed nearly half the time but we try and have that as our absolute core value. We try and create an atmosphere that allows people to achieve their full potential.

IK: One of the big changes in the past 20 or 30 years has been the number of lawyers who work in the larger firm. This creates a race for talent. Is it tough to get the right staff?

PL: We have been very lucky. This sounds arrogant, but it has not been tough to entice in really good people. It is something about the formula: one day we may be as big as the big four, but not being as big as the big four but having the clients like the Data Protection Commissioner, like Ryanair, like the HSE, like Disney, attracts the right type of lawyers.

IK: People want to work on interesting cases

PL: Exactly. The best clients want the best lawyers and the best lawyers want the best clients. So there is a synergy there. We have those lovely and interesting clients with interesting problems, like those injunctions we got for Ryanair very recently. But we are not a massive factory or a very large law firm. The word factory is unfair because the big firms are very good and they are conscious of their own employees as well. But we are a small unit of 150 people and people feel they belong and can steer the ship in the right direction.

“Remember why you became a lawyer. Have the right reason. Law is the fabric of society.”

IK: You mentioned the Ryanair case. It must have been fascinating, and there must have been a sense of satisfaction when you get an injunction preventing stoppages, and also the lawyers in the UK did not get that for the company.

PL: I don’t know what the law in England would have said or why they lost and we won. But winning the case was great. Anne Bateman, a long and loyal supporter of Ryanair, managed that case and she is so talented. From a personal point of view, I really felt there were thousands and thousands of people who were due to fly somewhere and to allow them to fly and postpone the industrial action was just the right outcome. It was good for people and that is what the law should be delivering.

Photo: Bryan Meade

“What I would change about the legal profession”

IK: Are you in the courts much yourself?

PK: Less and less often. We have had several procurement cases which I would have followed and was involved in. But less and less. But I have appeared in the High Court sometimes and I have done a lot of arbitration as an advocate. In my heart, I am also an advocate and I would encourage all my colleagues in the firm to actually be advocates before the courts. I firmly believe that the barrister profession and the solicitor profession should be merged. I don’t think that the distinction is particularly helpful to the client.

IK: Why do you think so?

PL: Partly because when I worked with Max Abrahamson, it was mainly arbitration and there were normally large arbitrations such as infrastructure disputes in Iraq or in Saudi Arabia, he did the advocacy. I have done advocacy in multi-million euro arbitrations – I have never actually lost one when I have done the advocacy myself. I don’t understand in a very complex case how you can differentiate between the person researching, reading all the files and then delivering that to the arbitrator or judge.

IK: You can see the great verbosity and flourishes of barristers, but a solicitor often hands them a lot of papers and lines.

PL: You may need a different person to help with the papers sometimes. There are brilliant barristers and brilliant solicitors but I have always been uncomfortable with the concept that you pass the research and work to someone else to present it when you understand the facts. When you present a case, bombastic behaviour and style can have a role to play, particularly with the jury. But knowing the facts intimately and knowing the law intimately is what will win you the case. Judges will not be influenced by bombastic behaviour, particularly when you go to arbitration  when you don’t even have a judge or a barrister in the middle – you might have an engineer and they really like a person who is not play acting and who gets down to the facts. I have been a supporter of that.

IK: What else would you change about the law if you had a chance?

PL: I would digitalise it. I am ashamed to say that our firm burns 380 trees a year because all the papers go to litigation. They are single sided. I would love to see much less paper. The Four Courts and I would like to see more solicitors on the bench because I think they make very good judges.

Separately from my own practice, I am really concerned about the compensation culture. We have lost the plot completely; there are €2.4 billion in claims against the State, €400 million paid in respect of HSE medical claims. It is absurd when you think what the money could do employing more consultants, building more hospitals and more digital technology within the health service. The claims culture is a massive problem in Ireland.

IK: Do you think it is the culture yourself or do you think it is the size of the pay-outs? Or does it all feed into each other?

PL: You have put your finger on it. One feeds into the other. In the UK, the compensation is generally about a quarter of what it is here. I don’t think it is fair to blame lawyers, if you come to me here today and say you tripped on someone’s bicycle parked in the wrong place and I tell you I can get you one million, my job is to get it. The problem is the money is being handed out too loosely.

IK: There is also the culture of secret settlements, when you pay to avoid going to court even when you have done nothing wrong.

PL: You could have a case due for hearing and the barrister will say we have drawn Judge X, so settle the case. It should not be as subjective as that. If you know you can never bring a case before a certain judge… That exists in the system where you and I are living in, and you and I are paying for it. I am not comfortable with that at all.

 

The future

IK: Commercial lawyers witnessed the rise and fall of the economy. On a macros basis, where do you see the Irish economy now?

PL: If you put Brexit aside it is just thriving, absolutely we are in a really strong position. I know we have a big debt but GNP per capital is going down and with the current interest rate it is manageable. But Brexit puts everything into doubt. It is upsetting to have all the doubt about how we can finance the necessary infrastructure for housing, hospitals, cycling lanes, renewable energy, but the money is there to do it if the government is focussed. But Brexit brings everything to a halt. In my view, it is an act of vandalism and insanity.

IK: And what does the future hold for you and the law firm with your name above the door? Presumably you won’t stay there forever? I find it interesting that you are one of the few lawyers with the names above the door at a big practice who is still alive.

PL: It is one of my big selling points when I give a talk to young lawyers in universities to recruit them: my calling is that what is unique about me is that I am alive!

What is the next stage for Philip Lee? Politics interests me. I believe passionately in Europe. I believe passionately that the populism that has grown in the last five years, probably much longer, is a real issue. I look at Italy and Poland and Hungary and the UK…

IK: But there has been an intensification of that populism over the last five years.

PL: Exasperated by algorithms and the press in the UK. That worries me. I am certainly tempted. At some stage in the eighties, there was talk of Peter Sutherland being offered the presidency of the European Commission. I have known Peter and had the most enormous regard for him. I always dreamt that if he got that I would have given up anything to join his cabinet. Something like that would appeal to me. I would like to play on the bigger stage before I give up my active role.

IK: Your advice for lawyers coming through now?

PL: Remember why you became a lawyer. Have the right reason. Law is the fabric of society.

 

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