Canadian Underwriter

Lloyd’s names win right to appeal fraud charge

October 9, 2001   by Canadian Underwriter

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A group of 220 Lloyd’s investors (names) have another chance to make their case for fraud against the 300-year-old insurance market. The charges, which were put down by the U.K. Commercial Court late last year, stem from asbestosis claims of the mid-1980s. The names charge that Lloyd’s executives concealed the severity of asbestosis losses.
Although Lloyd’s was victorious in the original ruling, the names have now won the right to appeal the case. The appeals court is set to hear the case in January, 2002.
Following the asbestosis claims, which led to large settlements in the U.S. courts for claimants, Lloyd’s devised a payment package for its names. Some names, including Canadian members, refused to pay Lloyd’s and sought legal action for fraud.
In Ontario, a group of names recently lost an appeal at the provincial level to avoid paying the Lloyd’s settlement, although they have said they will appeal to the Supreme Court of Canada.
In response to the U.K. decision, Lloyd’s CEO Nick Prettejohn says the market is still convinced the Commercial Court’s decision in its favor will stand. “The Court has made it absolutely clear that its decision is nothing to do with the merits of an appeal, it is simply a reflection of the hug volume of evidence and length of time required to make any hearing of the arguments meaningful.”

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