I can see where the barrister is coming from. And strictly legally speaking, he is likely correct.
When you speak of the EEA citizens settled in the UK, I presume that you mean that they have acquired PR. PR is a status granted by EU law (specifically a transposition of Directive 2004/38/EC). If EU law ceases to apply to the UK, PR as a status will evaporate overnight.
It is not improbable that, given the volume of EU legislation in force in the UK currently, the UK Parliament will pass a stand-still law, keeping EU legislation as of a specific date in force unless repealed. That will keep the EEA Regulations in force unless repealed or modified and hence that would preserve the PR status of people who have acquired it (though amendments could be made to require them to hold very expensive paperwork proving their rights).
Alternatively, the UK government could, by statutory instrument, convert PR status into ILR under the UK Immigration Rules. That will have its own headaches, including the requirement to hold documentary proof.
In the unlikely event that the two bodies do not enact any specific provisions, in a last resort, the UK courts could enforce retention of PR status on the basis of the doctrine of legitimate expectations, in a similar way to the HSMP judgment.
Of course, these days,
expect the unexpected.
But the point the barrister was making was, retention of PR will not be automatic. No EU law, no status granted by such law.
Permanent Residence was predicated on EU law applying in perpetuity. That is no longer the case. It will be a case of "Here today, gone tomorrow".
It will require a positive action of commission (by primary or secondary legislation or judicial decision) by UK authorities to retain PR status for those EU citizens who have attained it.
I am not a lawyer or immigration advisor. My statements/comments do not constitute legal advice. E&OE. Please do not PM me for advice.