Legal Loopholes

Why do legal loopholes exist? And why do they linger for so long?

You may have heard of Russian oligarchs using secrecy loopholes, drivers avoiding bans for using a mobile by saying they were taking a photo, and recently, Jeremy Clarkson declaring he’d found a legal loophole to keep his Diddly Squat farm shop and restaurant open. (He’s now had to close it.)

A loophole is an unintended consequence, which happens when the law in text is then applied to our complex real world, and it simply doesn’t cover all potential situations. So, the loophole goes against the purpose of the law, but doesn’t break it.

Some lawyers make a career out of using them to win cases. Nick Freeman was a lawyer who became renowned for his vast knowledge of traffic law exploiting obscure relatively untested arguments and winning unlikely cases. He clocked up several celebrity footballer clients keen to avoid fines, including Alex Ferguson (cleared of driving on the hard shoulder due to a medical emergency).   

Of course, the more people who spot and exploit a legal loophole, the more attention it gets and the more likely it is to be closed. Seeking potential legal loopholes is often a key part of a lawyer's job. Contracts often need a legal eye to reduce the risk of someone discovering an unintended way to void the contract.

Or, the opposite, you may feel there’s something in a contract that’s unreasonable and a lawyer can help you argue it’s unenforceable and couldn’t be negotiated fairly at the time.

It’s yet to be seen if Elon Musk and his lawyers will find themselves in a courtroom with Twitter. If so, we certainly know it’ll involve a lot of hunting for potential loopholes.

Have you ever come across a legal loophole yourself?

Written by Jason Connolly