Good afternoon, Brian, and welcome to Commodity Conversations. To start, please tell me about your journey so far.
I’m Irish and partly grew up in Ireland. I studied law and politics at Galway University but decided to move to Cardiff to study law, particularly maritime law. On graduating, I went to Holman Fenwick Willian (HFW).
I joined Cargill in 1995 after a period at Middleton Potts, a famous commodity firm. Cargill was their biggest client. I initially spent some time in Cobham, where Cargill used to have their UK offices, and then moved to Geneva, where I served ocean transport, sugar, and other areas.
I loved my five years at Cargill but concluded that you either stayed there for life or went off and did something different. All my business in Cargill was captive; I wanted to see if I could build a practice.
Hill Taylor Dickinson gave me a partnership, but it was up to me to build my own business. I was lucky because Bunge was growing and had no in-house lawyers. Cargill remained a client for a while. I slowly increased my client base, benefiting from the absence of in-house lawyers. I became an external in-house lawyer for various shipping and trading companies. It was a natural habitat for me. During that time, I was lucky enough to witness and legally support the birth of Swiss Marine, FIS and later GMI.
I slowly grew and developed. I left Hill Taylor Dickinson, returning to HFW, where I had articled, partly because it was a more prominent firm. I have been with them for almost 20 years, and my business has grown significantly.
The nature of my work has changed over the years. Many companies now employ in-house lawyers. I have had to adapt and change my product. I have had to expand and diversify my practice.
I understand that you have been ranked in Band 1 of Chambers 2024. How does this happen?
It takes time and involves accrediting by your clients and peers. Over the years, I have worked my way up through the ranks. This was quite an achievement for a lad from Ireland. Nothing was ever given, but the loyalty and kindness of clients are something I have never taken for granted. I have had some momentous periods in my legal career.
Could you give me some examples?
The first was the Red Bean Crisis, when various trading houses found themselves with shiploads of soybeans sitting off China containing little red beans – beans that someone had dyed red. I still have some on my desk. It gave the Chinese buyers an excuse to reject the shipments, and the prices plummeted. It was my first experience of a significant commodity crisis.
My second crisis was the freight crash when the time charter rate for Capesize vessels went from $200,000 a day to zero or minus $ a day.
Can you tell me about that?
It was the only time in my life where I could choose which clients I acted for.
I had co-drafted the legal FFA document – the Forward Freight Agreement – with another lawyer. We built the contract’s architecture together.
When the physical freight market crashed, the forward market also crashed. Everyone knew I had co-drafted the FFA contract and wanted me to tell them how to deal with it. I was overwhelmed with physical and futures freight work in 2008 and 2009.
Since then, we have had various commodity price crashes and other world events, including the Russian invasion of Ukraine.
I said to one of my associates recently that I know it feels overwhelming at times, but this is my fifth crisis, and they all pass. It gets easier every time because you know how to approach the work. You know what matters; you know the priorities; you know the systems.
We are living through the Ukrainian crisis, where initially, some clients had to grapple with a suddenly changed legal world where sanctions had a huge impact on performance. I have been stress-tested and lived to tell the tale, building long-lasting relationships with traders, clients, and in-house lawyers. You are reliant on each other when you are in the trenches together. You learn a lot about each other; these are special professional moments.
I remember going to the Baltic Exchange during the freight market crash. Those attending owed millions of dollars in physicals or futures. It was paralysis. Rule B was in full force, and everyone had their bank accounts frozen. The whole thing was surreal. The owners, charterers, interested parties and brokers had never seen anything like it. The freight market was on its knees. I didn’t think so then, but in retrospect, I am fortunate to have experienced that unique period in market history.
How do you cope with the stress?
I remember sitting at my desk during the FFA crash and thinking that I just wouldn’t be able to cope with the pressure. Every client wanted my urgent attention. Everyone’s problem was unique and special. You just find great resolve, don’t you? You cope. I had a good group of Partners and associates around me. As I grew as a lawyer, I had more people around me who had similar experiences. I have had great support in the Ukrainian crisis. It was more brutal previously because I had fewer associates. I was still growing as a partner. But you just cope. There were long hours, long days.
I co-drafted the FFA document, and billions of dollars were traded on it. I thought, “Just imagine if we have missed something.” There were a dozen or so court cases that tried to undo the architecture of the contract. The brightest of QCs (Queen’s Counsels) were trying to argue that the contract didn’t work – that the architecture was wrong.
I will let you into a secret. When formulating the FFA contract, I kept a copy in my pocket for about three or four weeks, stress testing it, throwing situations at it, and seeing if it held up. I had done everything I could to make it work. It survived the court challenges, and the architecture proved sound. It was a huge relief.
We built the FFA contract pro bono. I knew it would be professionally fascinating, but it also meant that we had done something special – designed a contract that supported a hugely vibrant trade. Freight futures have now moved to exchange. I never worked out how many billions were traded on the FFA form.
How do you avoid burnout?
The freight crash was the closest I have come to it. You may have colleagues, but it’s a lonely place because, ultimately, the buck stopped with me.
As always, you must go back to people’s backgrounds and experiences – to their childhood. From the age of eleven, I attended a strong, traditional Irish boarding school. My parents had been in England, and although I was born in Ireland, the other boys saw me as a Brit. I spoke like a Brit. If you survive that without too many bruises, you can survive most things.
Is it tough to keep up to date with the Law?
I am passionate about keeping up to date with the law. Every day, I inject myself with a new matter, a new case. A client expects you to know the current law. You might think it’s obvious, but I am sorry to say that not every lawyer does.
You are the most active litigator in London in the commercial litigation rankings. Does that mean commodity trading has more disputes and litigations than other professions?
Yes, it does. However, the statistics embrace commodities, shipping, and other pieces of commercial litigation.
I have had something like 50 reported cases in my career. One case, for Cargill, went to the Supreme Court. We won.
One of your ex-colleagues at Cargill told me you were a lawyer who solved problems rather than created them. I asked him if he thought some lawyers created problems, and he told me I had to ask you that question.
I come from the Cargill Academy. People at Cargill didn’t enjoy disputes and didn’t want them. They preferred to protect relationships but, at the same time, solve problems.
I believe every legal problem, whatever the sector or subject, is capable of solution.
Years ago, I was lucky enough to go on a mediation course where I saw the early benefits of mediation as a way of resolving differences. Mediation is a slightly more formal structure than a conversation. We ended up putting mediation clauses in Cargill charter parties, probably one of the first in the industry to do so.
Do I think some lawyers create problems? Yes, I think some do. Many colleagues are interested in solving problems, but lawyers sometimes respond to a client’s passion and emotion. Emotion is a dangerous thing because it can make it more challenging to solve problems. This is why divorce can be so conflictual. Commercial problems should all be solvable, however emotional they are.
Clients need to own a dispute and not leave it to the lawyers. Clients should remain invested and interested. The best clients remain interested and invested and play a significant role in the solution.
How does arbitration fit into all of that? Do you put arbitrations in the same category as court?
Arbitration is more hostile than mediation, which is a more informal affair. People regard arbitration as a gentlemanly form of court action. You are judged by commercial people who you respect, and there is a sense that commercial morality will prevail. Contract interpretation is all about the words, but the context does matter. There’s a belief that arbitration often provides a more commercial judgment than a court.
One advantage of arbitration is that it is confidential. If there are embarrassing elements in WhatsApp or emails, they are protected. It’s a less hostile forum. It’s not open; you’re not in the witness box in front of the court. I would argue that it should be mediation, arbitration, and court – in that order.
Unfortunately, enforcement of an arbitration award (or judgment) can be a stubborn issue. You may win the battle but lose the war. Over the years, I have specialised in collecting awards, and we have recovered many millions on behalf of clients.
Where do most problems arise within that agricultural supply chain?
They have changed over the years.
You have the classic quality, quantity, performance, and force majeure. New issues might be cyber-attacks and force majeure resulting from sanctions. Contract drafting is becoming increasingly sophisticated, with cross-default provisions and termination clauses becoming increasingly common.
Which commodities have the most problems?
Sugar has always been a challenge, and it remains so. Jurisdictions remain an issue. You win the award, but what do you then do about it? Cotton has had its fair share of problems, as has fertiliser, the latter because of sanctions.
How many commodity lawyers are there?
I would say there are around 100 very active commodity lawyers in London. It’s not that many compared to shipping, where there are many more. There is a shortage of talent in commodities. Many trading companies have hired commodity lawyers and are looking to hire more.
Law firms have lost people as a result. If there were a massive crisis again, you’d probably have a shortage of lawyers.
What would you say to a young law student to encourage them to come into commodities rather than something else?
I would say that international trade is fascinating. The best cases result from the buying and selling, the finance, and the shipping of goods. Without commodities, international trade, and shipping, the law reports would be a fraction of the size. Every area of the law seems to have been developed because of the business that we are in.
I would say to young lawyers that they will have to work hard, and there will be challenges and pressures, but it’s a wonderful area if you’re interested in the law and the development of the law.
And what would you say to a trader to try to stay out of trouble?
Realize that you are both masters or mistresses of your contractual destiny. The words you use in your contract will dictate the outcome. I try to get people to realise the power and impact of words and to get it right at the beginning. It usually leads to a happier ending.
Any final thoughts?
Words are my commodity, and the words chosen will almost always dictate the outcome of a dispute. I spend an increasing amount of my time guiding clients appropriately.
Personally, it has been a privilege to experience the highs and lows of the commodity market from a legal perspective. The characters I have met and the professional friendships I have developed have led me to conclude that this remains a people-centric business, where conversations lie at the heart of what I do.
© Commodity Conversations ® 2024
This is an excerpt from my new book, Commodity Professionals—The People Behind the Trade, now available on Amazon.
