The status of Lloyd’s

The Reconstruction and Renewal Scheme, agreed by Lloyd’s in 1996, has spawned a mass of litigation in the succeeding years. The most significant aspect of R&R was the establishment of Equitas to act as reinsurer for the liabilities of Names, but in return Names were required to pay substantial premiums to Equitas for that cover. Many Names contested the obligation to pay the premium, but in a series of decisions their obligation to do so has been confirmed by the courts and all challenges to R&R have been rebuffed. Most significantly, in Society of Lloyd’s v Jaffray [2002] EWCA Civ 1101, the Court of Appeal held as a threshold point that Lloyd’s had not been guilty of fraud. In the most recent battle, Society of Lloyd’s v Henderson [2007] EWCA Civ 930, the Court of Appeal has rejected an attempt by various Names to resist bankruptcy and other proceedings to enforce payment of the Equitas premium and based on assertion of the tort of misfeasance in public office.