Mayfair property managers to Abu Dhabi royals ‘treated like excrement’

The managing director of the firm that managed the UK estate of the Abu Dhabi royal family for more than 16 years told an employment tribunal today that he was treated like “excrement” when the contract was terminated. John Kevill and Andrew Lax, the directors of Lancer Asset Management, are bringing an action at the tribunal for unfair dismissal and failure to comply with TUPE regulations. Lancer ran the Abu Dhabi royal family’s UK property holdings, including the Berkeley Square estate, from 2001 until last year, increasing its value from £325m to more than £5bn. That arrangement was terminated by its client and Lancer was replaced by Astrea Asset Management last year. Initially, the Lancer employees, including the directors, were to have been transferred to Astrea under TUPE rules. But it failed to happen amid accusations of breach of fiduciary duty and failing to cooperate on an orderly handover of the business. Lancer is disputing those claims. Under cross-examination from Astrea’s lawyer, Simon Devonshire QC, Kevill said he felt badly treated by “some of the operatives” of the Abu Dhabi royal family. “After making the royal family so much money, we were treated like dog excrement, wiped on the side of the pavement,” he said. He said while he has “great respect” for the royal family, he has a different opinion of “some of their people”. Astrea’s lawyer put it to Kevill that the Lancer directors were spending much of their time running a private investment management business funded by their asset management fees. While the directors did run their own property asset management and trading business, “the engine” of their operation was the Abu Dhabi portfolio, Kevill said. Devonshire said the management fees they charged for their work on the Abu Dhabi portfolio were “passed up” and used to fund the directors’ “personal property portfolio”. Devonshire said in 2017 the directors had amassed more than £15m of property, and had sold around £2m worth the year before. At the same time, Devonshire said the Abu Dhabi portfolio work had slowed down because its “growth phase was over”. And in addition, the management of the directors’ portfolio “took up a lot of Mr Lax’s time”. “I wouldn’t deny that,” Kevill said. Lax was the chairman and co-founder of the firm. Devonshire said that in the months before the business was transferred, Lancer updated staff and director employment contracts to add salary increases, guaranteed bonuses and termination packages to safeguard their interests in the event of a takeover that led to terminations. Kevill said he didn’t accept they were creating “golden parachutes”. He said they were updating old contracts. The directors of Lancer first picked up the contract to manage the Berkeley Square estate on behalf of the royal family while at GVA Saxon Law in 2001. Alongside the flagship asset – Berkeley Square – the estate includes the former BHS store on London’s Oxford Street, and 33 Cavendish Square, both W1. Astrea, formerly known as Squadron Properties, was set up in October 2016 by Mustafa Kheriba, the chief operating officer of Abu Dhabi Financial Group and an executive director of Northacre, the developer behind New Scotland Yard and 1 Palace Street, both SW1. Astrea was given the contract to manage the estate in July 2017 and formally took over on 28 September. Duncan Ferguson, another director of Lancer, is bringing a separate claim for unlawful disability discrimination and unlawful detriment under the Part-Time Workers regulations. Ferguson claims he was dismissed just hours after transferring to Astrea because the firm was unhappy with his need to work part-time. He was operating on part-time hours to take care of his terminally ill wife. Unlike unfair dismissal claims, disability discrimination claims are uncapped. Kevill and Lax are both seeking termination payments, while Ferguson is understood to be seeking reinstatement to his previous role and compensation for loss of earnings or compensation for unfair dismissal. The case continues.