Barristers and Bankruptcy: not mutually exclusive?

It is sometimes thought that bankruptcy is, in itself, a reason to be struck off or disbarred from legal practice as a Barrister.

But the Bar Standards Board of England and Wales makes clear on its website that this is not the case as a matter of English practice:

All barristers, whether practising or not, are required under Rule C65.6 of the Code of Conduct in the BSB Handbook to report promptly to the Bar Standards Board if:

  • Bankruptcy proceedings or directors disqualification proceedings are initiated against him or her 
  • A Bankruptcy order or directors disqualification order is made against him or her 
  • He enters into an IVA with his or her creditors

Entering into an IVA or being subject to a bankruptcy order is not in itself a disciplinary offence or a bar to practising; however, failure to promptly report these circumstances to the BSB, or failure to keep the BSB updated after reporting, may give rise to disciplinary proceedings.”

In other words, it is not the mere fact of bankruptcy that is a disciplinary issue, but the circumstances leading up to the bankruptcy, as well as the barrister’s conduct after the bankruptcy, that might give rise to disciplinary concerns.

This is a rather fortunate state of affairs, for example, for a leading English tax QC called Andrew Thornhill QC, who was remarkably made the subject of a Bankruptcy Order on 8 March 2017 (on the basis of a petition presented by HMRC), only days before he appeared as Counsel for the taxpayer (Rangers Football Club) in a tax appeal to the United Kingdom Supreme Court, as has been widely reported recently.

The Bermuda Bar has not found it easy to deal with the bankruptcy of Bermuda barristers from a regulatory perspective, as the cases of Julian Hall and Llewellyn Peniston both illustrate. The fact that Bermuda is a fused legal profession (in which Barristers also handle client money, in their capacity as Attorneys) means that the issue is slightly more complicated than in the case of English barristers – who generally do not handle client money (which is the responsibility of solicitors).

As The Australian Newspaper once put it, therefore, Bankruptcy isn’t the end for Barristers.

But it should probably not be encouraged!

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