International experience ahoy! Trainees get to do an overseas seat at this specialist firm – and have “a hell of a lot of fun” along the way.
Boats, paying for boats, and the stuff that goes in boats: to many that’s what Watson, Farley & Williams is all about. But while Chambers UK places the firm at the top of the London shipping finance market, there is a lot more going on below deck. The firm has spread its tendrils into related practices like aviation, project and trade finance. WFW is also building in areas more associated with bigger full-service firms, like energy, employment, litigation, capital markets, tax and competition.
When two plucky Norton Rose partners (Messrs Watson and Farley) jumped ship to set out on their own in 1981, the Eighties commercial frenzy and a thirst for international expansion set their new firm on the right course. It steadily diversified and amassed a network of 12 overseas offices dotted around the world’s major ports and financial hubs. The training contract at WFW encourages an international mindset and sends all trainees overseas for one seat.
For the first time ever, 2013 saw the firm’s revenue surpass the £100m threshold. The other good news is that it hasn’t asked any trainees to defer their start dates this year (although this did come with at least £5,000 compensation in 2013). Current trainees also felt relatively confident about their post-qualification prospects and eventually ten of 14 were retained.
The two years are split into six seats. “The seat choices are more limited than they seem if you’re looking beyond finance and finance litigation,” sources felt. Before joining, new trainees list three preferences for the first seat. Once through the door “seat allocation is a much more collaborative process; towards the end of each seat you have a meeting with HR to discuss where you want to go next and why.” Most were happy with their allocations and even those less impressed admitted that “because a seat abroad, asset finance, litigation and corporate finance are compulsory, most people ultimately end up with a similar training contract, just in a different order.”
Asset finance is WFW's flagship department, so expect “non-stop high-level work, but also exposure to clients.” This is a world leader in ship finance, so get used to some deals with very big boats, such as acting for Standard Chartered Bank on establishing a $109m loan for four 51,800 DWT MR (get used to vessel nomenclature too) tankers for Leopard Tankers. Ships occupy the large part of the asset finance team, but planes and trains also get a look in. Recent cases include advising Lloyds Bank, Lombard and Barclays on the $300m financing of a portfolio of helicopters for offshore oil and gas operations. “I found myself doing the kind of work I never thought I'd have the opportunity to do as a trainee,” said one of many upbeat interviewees. This was down to the generous levels of responsibility: “I was drafting complete loan agreements to be amended by my supervisor;” while another was “running ship delivery files – almost on my own – making sure that all the necessary document lists are up to date, as well as dealing with the opposite side and directly with the client.” The work suits the internationally-minded: “I was on the phone to lawyers in Panama and shipping agents in Malaysia in the past week, and I went to a ship delivery.”
“Some matters in PCEF go on for years,” a trainee told us, “if not a number of months.” The department is split into construction/projects and finance, with experiences varying between each. In construction, which has “an energy focus – think wind farms and solar farms,” trainees typically found themselves “monitoring data, uploading files, helping to draft client reports and assisting with contract reviews.” Those on the other side were predominantly concerned with finance –“we usually act for large energy companies or banks” – a recent client being Deutsche Bank as the lead arranger on the £70m financing of a biomass energy facility in Beckton.
Litigation is a broad practice, but the ubiquitous shipping clients dominate as usual. Our interviewees got involved in some quite interesting and varied work including “an arbitration over the switchover from analogue to digital TV, time charter issues and swap disputes.” Clients include the government of Pakistan, RBS and Bank of Moscow, and a lot of the disputes involve international trade, natural resources and energy. Typically trainees find themselves “doing a lot of bundling and photocopying but also undertaking research, participating in contract reviews and sending out emails to the various parties.” One trainee got a particular buzz from “the weekly court run; it's nice to get out of the office, mingle with bewigged barristers and pretend you know what you're doing.”
The corporate department is “very big on integrating with the other practices at the firm.” This shows in the firm’s headline transactions involving oil tankers, North Sea gas field acquisitions and wind farm takeovers. As is common in a lot of corporate teams, trainees were dealt a “feast or famine” style of workload, depending on the stage of the M&A cycle. Interviewees found themselves “drafting corporate authorities, dealing with company secretarial matters and filings with Companies House.”
“People should make sure they realise that property, employment and tax are niche areas at this firm,” warned one trainee. Competition included, these departments are generally “ancillary to the asset finance, litigation and corporate departments.” In employment “there were lots of immigration issues brought in by existing finance clients,” for example. Meanwhile those in tax, property and competition dealt with elements of larger finance, corporate or litigation matters. Training is handled department by department, and includes sessions for new joiners at BPP.
The compulsory overseas seat is usually the preserve of much bigger organisations, so our interviewees were naturally rhapsodic about their four-month postings to either Hamburg, Athens, Singapore, Bangkok or Paris. Singapore is “a hell of a lot of fun,” apparently. The office is “very busy” and trainees were “handed tasks from loads of different departments.” The fast-paced atmosphere meant “having to learn to stand on our own two feet,” and the level of responsibility is closer to “what a junior associate would expect back in London,” being “ultimately responsible for a lot of our own work.” Our interviewees found “the atmosphere in the Singapore office far more relaxed than in London, and less hierarchical; people at all levels chipped in to do the boring bits.” This gregarious cohort “puts on a lot more social events than back home.” One trainee had “played six-a-side football, attended a client horse-racing day and a cricket match – plus an awful lot of pub trips.”
Those who’d ventured to Paris concluded that “the culture is very different; it's much more face-time oriented. People would never think of leaving the office before 7.30.” One went further: “I definitely prefer the UK's work-hard, play-hard approach.” But still there is some joie de vivre to be had: “The teams are much smaller so you form much closer working relationships with people.”
Athens is now the sole office in Greece, having absorbed Piraeus into it. Trainees there are given “their own transactions,” which is “scary to start with, but I came back with loads of confidence,” said a source. One advantage of going to Greece is that “many of the people who own the shipping companies we act for are based here, so it's brilliant for client contact.”
Back home, the London office is conveniently located behind Liverpool Street station in a building that’s “not especially stylish or glamorous,” but we do hear “rumours of it getting updated.” Lawyers sit “two to an office and these are mostly grouped by department.” Alongside the usual swanky meeting rooms, client suites and canteen, the firm also comes with changing rooms “equipped with GHD straighteners, which is pretty snazzy.” Less snazzy is that “the canteen isn't open in the evenings; it would be nice not to have to get so many takeaways,” grumbled some sources. One turned this into a positive: “It shows how few people stay in the office late into the night.”
Official business hours at WFW are 9.30am to 5.30pm. In reality the day is longer, and trainees found the hours increase significantly in certain seats: “You're expected to be willing to work long hours in the firm’s core departments,” especially when there’s a big transaction closing. One told us of an extreme case where “I was in the office till three in the morning during a particularly manic deal just before Christmas.” Life is “steadier in tax and employment,” where “it would be unusual to have to stay later than 7 or 8pm.” Do partners acknowledge this dedication? “We’re disgruntled by the lack of appreciation,” felt some interviewees, while others said that “people will often follow up to say thank you for doing extra work.”
“Shipping is quite a close-knit industry; it feels like a community,” mused one recruit. WFW’s manageable size, too, presents a “very unintimidating” milieu to new trainees, who felt able “to get to know a wide range of people from across the firm,” and rarely would they “go to the kitchen and find people I don’t know.” In this environment “it's easier to make your mark,” but “this does mean that all the partners quickly know how good or bad you are.” Our sources depicted a collaborative workplace: “Everyone is keen that the trainees learn as much as possible” and “even when someone has to stay late to answer your questions, they never give you the sense that you're being a pain.”
Each year the firm hosts Christmas and summer parties, fee earners’ dinners and welcome drinks for new trainees. There are also “wine-tasting events and the odd champagne reception.” Year on year, our interviewees go weak-kneed about the firm’s French chef Philippe and his exquisite canapés. “You can always tell when the canapés are about to be brought in as everyone starts edging towards the doors.” This is a sociable firm: “The trainees go out all the time; I've been told I'm antisocial because I can't make every Thursday and Friday.” All this carousing and still “there’s a disappointing lack of scandal” – the opportunity to make your mark?
With three different finance seats being almost inevitable during a WFW training contract “aspiring trainees should certainly have an interest in that area of law.”
Vacation scheme deadline: 31 January 2015
Training contract deadline: 31 July 2015
“The numbers of applications we receive varies year by year,” Watson, Farley & Williams' graduate recruitment manager Louise Turgoose tells us. “In 2013/14, we saw them increase by a third, with 700 received in total.” Half of these were for the firm's vacation scheme, and half were from applicants gunning directly for a training contract.
Both types of applications start with an online form that asks for details on an applicant's academics and work experience. “Legal work experience is essential for those applying directly for a training contract,” Turgoose says. “We need to see that these candidates really understand what they're applying for and have identified us as a firm they want to train at.”
The form also includes various open-ended questions. “It's difficult to get an accurate feel for a person from an application form,” Turgoose admits, “so we also ask about their involvement in extracurricular activities like community or charity work. This is a chance to talk about activities that have provided you with some life experience and some useful skills.”
For vac scheme and training contract applicants alike who impress on paper, the next step is an assessment centre. Turgoose is reluctant to reveal many details about the day, but she does tell us: “it's a fairly typical one involving group and written exercises. We've tried to make these as close as possible to the sorts of things trainees do daily here. We don't ask people to take any form of standard verbal reasoning test or off-the-shelf psychometric test.”
The day also involves lunch with the current trainee cohort. Turgoose insists “the trainees are not briefed to feedback to HR, as we want people to be able to relax and ask questions,” though we suggest keeping to your best behaviour regardless. At the end of the day, assessors give candidates feedback on theire assessments. “We feel it is important to recognise the efforts candidates have put in up to this stage and give them something to take away,” Turgoose explains.
The vacation scheme
Following the assessment centre, WFW chooses its vac schemers. Turgoose encourages trainee hopefuls to apply for the scheme: “Generally we find vac schemers are better informed about us and what we do, and as a result tend to perform better in their final interview. Ideally we aim to offer training contracts to 60-80% of our vac schemers, as they have spent time seeing the firm first-hand, and we've seen what they can do.”
That said, “we deliberately leave some places for those who have applied directly,” she points out. “We find we're fishing in a different pool of applicants at this point – we often pick up people who attended on magic circle vac schemes and then decided it wasn't for them.”The firm runs three placements – Easter, June and July – and each lasts two weeks.
The firm aims to interview around 25% of those who have attended an assessment centre, including vac schemers, who undergo their interview during the second week of their placement. Direct applicants, meanwhile, attend theirs in August.
The interview is conducted by a partner and Louise Turgoose herself, and opens with a chat about the interviewee's motivations and interest in law.
The rest of the interview is split between competency-based questions and those designed to eke out a candidate's personality. “We want to ensure that they understand the work we do and are motivated to work for us in the long term,” says Turgoose, adding: “We especially want to see curiosity about the sectors we work in, though we don't expect them to be sector experts at this stage.”
Traditionally, there are three main types of marine insurance: hull and machinery; cargo and protection; and indemnity insurance.
Hull and machinery insurance
Hull and machinery insurance is essentially a form of basic property insurance designed to protect the owner's investment in the ship itself. Such insurance is usually arranged through a professional insurance broker. Often the cost of insuring is spread between a number of different insurers from around the world, called a syndicate. The single biggest market for marine insurance is Lloyd's of London. This market is an operations base for companies from around the world, especially from seafaring regions like Scandinavia.
Typical claims under this type of insurance policy might relate to the total loss of a ship, damage to a ship's engines or equipment, explosions, fire, and damage caused by grounding or collision with another vessel or an object in the water.
Cargo insurance is taken out by shipowners in order to protect them from damage to or the loss of any cargo they might be transporting.
Protection and Indemnity insurance
Protection and Indemnity (P&I) insurance covers shipowners against legal liabilities they incur against third parties. In the context of marine insurance, a 'third party' is anyone – except the shipowner – who might have a legal or contractual claim against the vessel. For example, P&I insurance covers a ship owner for losses incurred due to the death or personal injury of a third party, losses incurred by passengers (including stowaways and people rescued at sea), as well as broader claims such as environmental pollution.
In the context of P&I insurance, the word 'protection' means that the insurance covers the costs of any recovery or assistance that the ship and its owner might require in the course of an accident.
P&I insurance is a form of indemnity insurance. This means that a shipowner must demonstrate his loss to the other members of the 'club' (see below) before they will pay out, or indemnify him or her. But the 'club' never assumes the shipowner's liability, which means that technically the owner remains responsible for any payments.
P&I insurance is usually arranged by entering the ship into a mutual insurance association, often referred to as a 'club'. Unlike normal marine insurers which operate as normal for-profit organisations answerable to their shareholders, a P&I club is only answerable to its members. Rather than paying regular premiums, members are required to respond to 'calls' as and when a claim is made by a participating ship owner. These calls are paid into a common fund which is then used to cover any costs arising from the member's claim. If costs are higher than the initial 'call', another might be requested from members. Inversely, if costs are lower then members are refunded or asked to contribute less the following year. In order to join a P&I club a shipowner must have a good reputation as other members will be assuming a share of the risk associated with a new participant's business.
Student Guide: What are the firm's biggest highlights over the last year?
Chris Lowe: Firstly we've increased our revenues and passed the £100m mark, which is very positive. Our Frankfurt and Hong Kong offices are well bedded in, and are now fully established. They're really contributing to the business – meeting and exceeding their targets – which demonstrates how well our international growth strategy is working.
I would also say that some of our CSR initiatives are developing nicely due to a more targeted approach: specifically we're engaging on a regular basis with Medecins Sans Frontieres.
The other thing I would highlight is the development of our private equity business, which is very active, increasingly with regards to the energy sector, where we're seeing strong development.
SG: You were named managing partner alongside German colleague Lothar Wegener in January 2014. Do you have any plans to change the firm's strategic direction?
CL: Because of the nature of our business, we want to continue to be a partnership where each partner is once removed from management. We've had to double up firepower to head up WFW, and the international culture of the firm fits very well with who we are. We ensure we have committed managers established in our core sectors; consequently our maritime, energy, natural resources, aviation and real estate practices have all grown very well over the last two to three years. It's business as usual, but we're investing in those areas of our business.
The other thing is that although we're realising new sectors, we can't in any event ignore the fact that 25% of our turnover is non-sector specific.
SG: Are there any practice areas that you've noticed growing or shrinking? Any developing trends?
CL: In terms of new geographic areas, we’ve opened a new office in Dubai, which will initially focus on the maritime sector.
The last two to three years have not been kind to Western economies. New York and Western Europe has had a rough time, but our business is countercyclical. Oversupply and fee pressures in these jurisdictions can be good for us as they allow us to be more picky in the work we accept.
SG: How would you describe WFW's working culture?
CL: Entrepreneurial is a good way to express us. We're very service-minded and partner-led; our clients see the partners and we understand the industry and needs of our client. We want to be good at driving businesses forward. Our partners make themselves accessible to trainees and work closely with them.
People who pay attention to the details, and are hard-working, trustworthy and confident tend to thrive here. You've got to be curious – it's very rare someone comes in as a sector expert, so you need to be eager to learn about the sectors you work in. We like people who have done their research and have a few questions. We're also looking for people who are passionate about their job and are interested in the clients. They need to be able to build up relationships, have a rapport with individuals at client companies and become immersed into their business.
SG: Several trainees in recent years have qualified into overseas offices. Is this opportunity available every year? Are NQ positions abroad offered alongside the more common options when trainees go through the qualification process?
CL: 60% of our turnover is generated outside London, and English law is needed in most offices. We have opportunities in Singapore, Hong Kong, Hamburg and Dubai. The great thing is that people are moving all the time; our assistants are constantly going out to different offices. These changes happen throughout the firm, both for trainees and those who are qualified.
I've been here since 1989 and have spent 18 of those years outside of London. We have a big culture of people who have been in a number of different offices, and it enables you to learn a lot. For example you begin to understand how an Asian shipowner thinks differently to a Norwegian. Or you might notice the difference between the drivers of renewable energy in Europe and Indonesia. Having exposure to these situations makes you realise what it is that makes clients appreciate lawyers. We encourage trainees to go overseas because it allows them to network and gain exposure. It also gives them real career paths into different parts of the world.
SG: What do you look for when recruiting trainees? Who fits in?
CL: Is there a WFW robot out there? No. We're not as culturally distinctive as some of the magic circle firms. I see us as an environment where people who like to fit into a flat structure would do well, and where entrepreneurial thinking is encouraged.
Watson, Farley & Williams
15 Appold Street,