Legal Ethics: Keeping A Level Playing Field

Sport can teach us many lessons about ethics. The recent publication of the Wells Report into the alleged activities of the US NFL team, the New England Patriots, has highlighted "sharp practice", which has also been an issue the courts have had to consider in recent times.

The Wells Report (the "Report") was ordered by the NFL into the alleged conduct of the New England Patriots. The alleged conduct related to the deflating of the match balls used by the Patriots with the advantage being that under-inflated balls are easier to catch in wet conditions.

The findings of the Report were quite negative for the Patriots and their quarterback, Tom Brady. The Report found it most likely that Mr. Brady had a general awareness of the practice of underinflating match balls. Relatively punitive sanctions were imposed on the Patriots.

One interesting aspect of the Report is the content of the texts between the two most relevant staff members which were examined in the Report. The texts, while incriminatory, also refer at times to Mr Brady in quite derogatory terms.

Cut and Thrust of Negotiations

Issues arising from the cut and thrust of legal negotiations were the subject of the Irish case of Slattery -v- Friends First Life Assurance Company Limited1. The case related to an unsuccessful investment in the St Regis Hotel in Washington by an entity connected with the plaintiff.

As part of the deal, a deed of pledge was negotiated for the purposes of giving additional collateral in favour of the defendant over shareholdings in certain projects in which the plaintiff had an interest. The negotiation of the deed of pledge took place mainly between the general counsel of Claret Capital - an entity the plaintiff had an interest in - and a law firm who acted for the defendant.

At quite a late stage of the drafting process, a clause 2.2 was inserted in the document by the general counsel which had the effect of limiting the liability of the plaintiff under existing guarantee arrangements.

The law firm acting for the defendant did not notice the proposed clause in their subsequent review of the draft and had not sought to amend it. It ultimately appeared that the defendant made what was a unilateral mistake in that it understood that the original guarantee was still fully enforceable against the plaintiff.

The difficulty the plaintiff had in this case was that the limitation of the plaintiff's liability under the existing guarantee arrangements had never arisen...