Lloyd’s of London has won its multi-million dollar legal battle with 200 ‘Names’ – investors who pledged their financial backing. In the case, the investors claimed they signed up with Lloyd’s under false pretenses, alleging that those running the insurance market had known of the looming huge asbestos claims.
But High Court Judge Cresswell rejected the investors’ allegation that they were the victims of a sustained fraud, saying there should be an independent panel set up by Lloyd’s to consider the individual cases of the Names who did not agree to a financial settlement in 1996. The majority of the 34,000 names who lost money as a result of the Asbestos-related illness claims settled after Lloyd’s offered a deal that vastly reduced their liabilities.
Today’s ruling came after a six-month hearing. Lloyd’s Chairman Max Taylor said Lloyd’s would press the 1,200 Names involved in Friday’s case to settle their debts, which he said amounted to around 50 million pounds.
“This is a landmark decision that closes a distant and troubled chapter in Lloyd’s history,” Taylor said. “With the case behind us, we can get on with the business of running the world’s foremost specialist insurance market.” Taylor went on to say that “allegations that have been made on and off for a decady by disgruntled Names have been utterly disproved. The judge made it very clear from the beginning that this would be the last opportunity for Names to raise these allegations.”
But the judge said during the course of the hearing that many Names had suffered heavy losses. External Names, whether or not they accepted Lloyd’s restructuring plans implemented in the 1990s, were the innocent victims of the failings and incompetence, he added.
“Many Names have suffered enormously in financial and personal terms,” the judge said. Examples presented by some Names recruited in the mid- to late-1980s showed strong arguments that the advice they were given “was at best grossly negligent.”
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