Lancer executives win unfair dismissal case

Lancer managing director John Kevill and asset manager Duncan Ferguson have won their unfair dismissal claims against Astrea Asset Management, the company that took over the management of the Abu Dhabi royal family’s UK estate. Lancer ran the Abu Dhabi royal family’s UK property holdings, including the Berkeley Square estate, from 2001 to 2017, increasing its value from £325m to more than £5bn. Lancer was replaced by Astrea Asset Management, and Lancer employees, including the directors, were initially to have been transferred to Astrea under TUPE rules. However, amid accusations of breach of fiduciary duty and failing to co-operate on an orderly handover of the business, the Lancer directors were dismissed by Astrea for “gross misconduct in agreeing new and (in their view, dishonestly) inflated contracts of employment for themselves and in obstructing requests for information by transferee and owner”. The directors deny misconduct. Ferguson’s contract was terminated after those of the other directors, and he transferred over to Astrea, but was dismissed soon after, he says, when the Abu Dhabi Financial Group learnt of his wife’s illness. The case was heard at the Central London Employment Tribunal in October 2018. The ruling has just been made public. The tribunal judge, Judge Goodman, found that Ferguson had been unfairly dismissed on the basis of a meeting that took place on the Friday before his first Monday at the new firm. According to the judgment, Ferguson’s employment with Astrea started on Friday 29 September 2017. On that day he was asked to attend a meeting with Giles Easter, chief executive of Astrea, and Mustafa Kheriba, chief operating officer. Kheriba was also chief operating officer of the ADFG, Astrea’s Abu Dhabi-based parent company. At the meeting, when asked why he had not been in the office much recently, Ferguson said it was “because my wife has got terminal cancer”, adding: “Sorry, weeks to go.” He said that he had been working flexitime and, because of his wife’s illness, he needed that flexibility to continue. Over the weekend, Easter, who said he had reservations about taking Ferguson on, reported to his superiors that Ferguson’s manner at the meeting was confrontational, and was given permission to fire him, which he did on the following Monday morning. The tribunal judge ruled that the dismissal was unfair because, at the Friday meeting, Ferguson “did not know he was, in effect, being auditioned for his job, rather than having a discussion on the practical operations on transfer or getting to know the new CEO”. However, the tribunal judge dismissed the claims of unfair dismissal brought by Lancer chairman Andrew Lax and finance director Bryon Pull, saying that in “recent years” the pair had done little work for the estate. “The tribunal concludes that for some years neither was assigned more than in small part to the activities of the estate,” the decision says. All four directors were awarded compensation of three weeks’ pay by Astrea, the amount of which will be agreed at a remedy hearing on 11 February. Ferguson will also receive a 25% increase in his award for Astrea’s failure to follow the ACAS code, whereas Kevill will receive a 100% reduction in his award for “substantially bad” conduct. The secret recordings While the Lancer v Astrea employment tribunal was based on the potential unfair dismissal of employees, the case also revealed some behaviours more normally read about in a John le Carré novel. Astrea chief executive Giles Easter was revealed to have made a number of covert recordings of his meetings with various directors of Lancer. Easter claimed he made the recordings as he had to “start up a complicated property asset management business with little help and needed to grasp many facts in a short time”. Lancer, however, claims that the recordings are suspicious in that it believes that not all of them have been made available. Duncan Ferguson’s 29 September meeting with Easter and ADFG chief operating officer Mustafa Kheriba was covertly recorded, but only the second part. Easter claims that in the first part of the meeting, Ferguson spoke in an “aggressive and confrontational manner” – a manner that is not reflected in the recorded part of the meeting. The tribunal judgment states: “Both socially and professionally covert recording is universally regarded as outrageous and a gross breach of trust… Anyone reading these reasons who has social or business dealings with Mr Easter will want to take care. While the accuracy of the transcripts is uncontested, the claimants point out that the person making the recording has the advantage of knowing his words are for the record, so while the others speak openly and without inhibition, the transcript may not be good or whole evidence of his own thinking at the time.”