Evvtex Co Inc v Hartley Cooper Associates Ltd and Ors - US District Court (SDNY)(Sweet DJ) - 17 January 1996

Insurance brokers pay out insurance settlement funds in accordance with instructions contained in letter forged by fraudster - Funds never received by assured - Whether brokers liable to assured

The plaintiff insured brought proceedings against the defendants to recover sums collected by the defendants in their capacity as insurance brokers and paid over to a third party. The third party was the acknowledged chief villain the case. He was an insurance broker who had made off with the moneys provided by Lloyd’s of London in accordance with an insurance policy. Both the defendants and the insured had been victimised by the third party, and both had cooperated unwittingly in the third party’s scheme to defraud. The issue to be resolved was which had to bear the loss.