1. The Judge has erred by failing to analyse and draw any logical connection between the staggering growth in membership of Lloyd’s in the 1970s and 1980s and the simultaneous massive growth in long-tail U.S. Casualty Liability.

2. The Judge has erred by failing to analyse the trial evidence on circulation of the Murray Lawrence letter and by ignoring all written evidence on its non-circulation. The judgement is defective in failing to draw the only sustainable conclusion about its purported circulation.

3. The Judge has erred in fact and law by condoning the gagging order imposed on Rota Officials and the judgement is defective in approving Lloyd’s decision to suppress crucial financial information to prospective Names in breach of the Statutory obligations of the Society to diffuse information. In supporting that breach of duty, the judgement is wrong in law.

4. The Judge has erred by failing to take account of public law duties owed by any and all commercial entities to any and all prospective investors in the context of financial and other information published in Lloyd’s Brochures, Global Accounts etc. The Judge has erred by failing to take due recognisance of the fact that such public law duties override the provisions contained in Lloyd’s Act of 1982.

5. The Judge has erred in law by failing to test the representations made in Lloyd’s Brochures, Globals, etc. against the Statutory duties owed and originating from Section 2 (1) of the 1967 Misrepresentation Act.

6. The Judge has erred in law by not taking account of current U.K. legislation, being the Human Rights Act 1998. The Judge has further erred in law by ignoring the supremacy of the Human Rights Act over protective provisions contained in Section 14 of Lloyd’s Act 1982 which had lost all legal and legitimate force in U.K. jurisdiction.

7. The Judge has erred in fact and law by dismissing Names evidence of Reliance on Lloyd’s Brochures, Globals etc which were instrumental in a Name’s decision on whether or not to join Lloyd’s. The judgement is defective in ignoring Lloyd’s incapability to delegate its Statutory duty to Names to their Agents.

8. The judgement is defective in failing to make charges of fraud against those members of Lloyd’s committee who placed insider reinsurance contracts to off-load APH liabilities whilst at the same time deceiving Parliament into enacting the Lloyd’s Bill in 1982 by failing to disclose the asbestos claims crisis and its implications for the solvency of the entire market.

9. The judgement fails to take due recognisance of the fact that those market operators who were either plainly dishonest or negligent were the same type of professionals who were elected to Lloyd’s Council and Committee. The judge has erred in fact and law by ignoring the obvious conclusions which should have been deduced.

10. The Judge has erred in law by reversing himself over his Lordship’s prior decision in the case of Henderson -v- Merrett in 1995.

11. Preliminary recommendations are submitted on the authority and remit of the Independent Panel to ensure its success.

12. The Judge has erred by denying Litigants in Person a fair trial and a reasoned judgement; not only were LIPs wrongfully denied the right to cross-examine, the integrity of the Trial itself was prejudiced by the Court’s refusal to compel Lloyd’s witnesses to attend.

13. The judgement is defective in ignoring the incriminating evidence in trial of non-disclosure in the placing of insider reinsurance contracts and the Judge has erred in failing to deduce that the Lloyd’s Officials were dishonest men who kept asbestos information to themselves for their own pecuniarv advantage.

14. The judgement is defective in condoning Lloyd’s omission to tell external Names of their (Lloyd’s) inability to achieve an equitable RITC in long-tail US Casualty business. The Judge has erred in fact and law by evading a core issue, principally that responsibility for full disclosure to Members rested with Lloyd’s centrally and was incapable of delegation to Lloyd’s Agents.

15. The judgement is defective in condoning the official statements made by Mr. Jackson and Mr. Kellett without deducing from the evidence in Trial that Lloyd’s Committee and Council possessed knowledge of the APH claims but which they chose not to pass on to incoming Members on Lloyd’s Council.

16. Litigants in Person seek a declaration of a mis-trial and I shall be inviting the Court to make a ruling on the 21~ December 2000 after L]Ps submissions have been closed. Pursuant to the Maastricht Treaty of 1992, of which the United Kingdom is a signatory, the Court should note that member States are expected to co-operate in judicial process. Accordingly I seek a referral to the European Court of Justice under Article 177 of the Treaty of Rome. I wish the matter of a fair trial to be the subject of the referral and in particular the ECJ’s interpretation of the Objectives and in particular Article K of the Maastricht Treaty. Under Article 177 of the Treaty of Rome I apply for a reference to the ECJ if this is the Court of last instance. This reference is mandatory unless the matter is "acte claire" and assuming this is the Court of last instance. Should your Lordship grant leave to appeal then the referral request would move to the Court of Appeal. If your Lordship does not grant leave to appeal and refuses a referral, then your Lordship must consider the matter "acte claire" and I am entitled to request your reasoning in writing.

Sir William Jaffray
Litigant in Person

13th December 2000

The judgement of 3rd November 2000 has evoked deep disappointment amongst Claimant Names, not least for the parameters set in order to acquit Lloyd’s of fraud. We are particularly dismayed because the decision fails to reflect the reality of what took place at Lloyd’s in the 1970s and 1980s.

I refer to the recruitment of some 27,000 Names between 1975 and 1989 against a backcloth of massive growth in long-tail liabilities from US casualty business, losses which the Deputy Chairman of Lloyd’s, Mr Murray Lawrence, conceded in November 1981 to be sufficient to bankrupt the reinsurers — reinsurers of which Lloyd’s was one of the most prominent in the world. For the Court to dismiss this expansion in capacity from capital providers as a natural phenomenon instead of drawing on the evidence in trial, which pointed out the disparity between growth in membership and actual business written, is unfortunate to say the least. As to the circulation of the Murray Lawrence letter, hard evidence in trial clearly contradicts the conclusion drawn in the judgement that the letter was sent to all managing and members’ agents. As the letter itself states and I quote: "managing and members’ agents are strongly advised to inform their Names of their involvement with Asbestosis claims.." it is hardly credible that its contents would not have filtered out to the membership at large if it had been circulated to many Agents, let alone to all. Yet no Name appears to have received any advice of such involvement or any advice other than that it was a containable problem.

And it is quite extraordinary to note in this day and age that any Court could approve of the instruction to Rota Officials to make no mention of asbestos at Rota interview. The deliberate suppression of information vital to any prospective Name in deciding on the merits of joining Lloyd’s is contrary to the duty owed by any commercial entity to any member of the public.

It has always been an unlawful act, indeed Mr Justice Tuckey admitted to one of the Litigants in Person three years ago that Ashmore was irrelevant prior to membership, a fact accepted by Lloyd’s.

I now refer to the duties owed by Lloyd’s to Applicants, the representations made in their brochures and the financial information contained in their published accounts. The duties owed by Lloyd’s to a member of the public are no different than the duties owed by any other corporation in this country. Those duties are in no way circumscribed by either the Lloyd’s Act of 1982 or the more recent Ashmore decision which has no retrospective bearing on the Threshold Fraud test; neither have any relevance or legal implication whatsoever until such time as an individual becomes a Name.

To an extent therefore, that a Claimant Name is entitled to claim damages for negligence or fraud, he is free to do so and can succeed on misrepresentation at the time of making his application for membership through till commencement of underwriting on or after 1~ January 1983. He is also entitled to remedy after that date as Section 14 of the 1982 Act offends Human Rights Legislation. By failing to draw a comparison between Lloyd’s and any other public company and by failing to use the yardstick of the 1967 Misrepresentation Act, the judgement seeks to condone the issuance of a false prospectus. The Court failed to note that Section 2 (1) of the 1967 Act places a duty on everyone not to make false statements upon which others might rely, thus removing the need to establish any duty of care. This applies equally in the case of Names who joined Lloyd’s earlier or who relied on Globals and so forth when deciding to stay on.

The Court should note that the immunities from suit contained in the Lloyd’s Act of 1982 are, we believe, totally contrary to natural justice and the rights of citizens who are now protected by the Human Rights Act 1998. Although Section 14(3) has yet to be repealed by Parliament, the protections which it affords Lloyd’s have been superseded by the HRA and should therefore cease to hold any legal force or validity in this jurisdiction in relation to any or all Lloyd’s non-public law regulatory functions. I submit the judgement is defective in failing to take account of current legislation and the Court has no excuse for this omission as it was put on notice during trial by leading Counsel.

The finding that the Brochures and Global Accounts do not constitute representations and that we did not rely on those representations (whether made to us by Lloyd’s or via their Agents) is perverse and contrary to the evidence. No reasonable man reading the Brochures could have failed to draw the conclusions pleaded as representations in this case. That was the whole aim and object of the various Brochures and there were no others a Name would have seen that could have influenced his decision on whether or not to join Lloyd’s. The mere fact that sometimes a Brochure was handed to a prospective or current Name by his or her Agent does not mean Lloyd’s was not responsible for its content or that Lloyd’s was capable of delegating its Statutory duty to Names into becoming a duty of those prospective Names prospective Agents. The hypothesis is bizarre to say the least.

It is timely to recall the circumstances of how the Lloyd’s Bill was railroaded through Parliament. There was no mention of APH liability in any of Lloyd’s lengthy submissions to Parliament, no mention of the asbestos crisis which threatened to bankrupt Lloyd’s, no mention of illegal roll-over insurance scams, no mention of the insider reinsurances placed by committee members and senior officials between August 1981 and March 1982, no mention of PCW, Brooks and Dooley or the Alexander Howden affair. As we heard in trial, Peter Green (who was dismissed and disgraced so soon after his breach of duty to his Names in the Imperial affair,) and his colleagues, were well aware of the crisis facing Lloyd’s since Rokeby-Johnson placed his reinsurance with Fireman’s Fund in 1973-74. These were the same highly motivated crooks who then proceeded to deceive Parliament in seeking immunity from suit.

It was against this history of wholesale chicanery and deceit that Claimant Names decided to bring Lloyd’s to Court on charge of fraudulent misrepresentation. Whilst not accepting the finding of the Court that there were no misrepresentations and no deceit, we are pleased to note the Court agrees that Names were the innocent victims of staggering incompetence by Underwriters, Managing Agents, Members Agents and other professionals regulated by Lloyd’s. For we know that those self-same Agents and Underwriters elected a number of colleagues from their ranks to Lloyd’s Committee and Council. The judgement carefully tries to construct a distinction between "incompetence" of market operators who gained promotion to Lloyd’s Council and charges of "at best gross negligence" levelled against those who did not attain high office. The judgement then constructs an artifice that those people, once promoted, are, as if by magic, absolved from all their sins, as if, blessed with instant amnesia, these highly astute businessmen would suddenly forget all their market knowledge, forget they were elected to perform their duty to protect external Names and diffuse information to them.

There are well-established legal precedents which hold a company accountable for the misconduct of their officers and agents. For any club which fails to control its members is equally culpable. Such artificial distinctions gives Litigants in Person the expectation that this decision can be overturned. If, as the judgement finds, the Agents had the duty to tell the Names of the hazards of long-tail business, then it presumes that Agents had the knowledge. How does that finding sit with the decision of Cresswell j who found a former Lloyd’s Deputy Chairman, Mr Stephen Merrett guilty of keeping Names in the dark? Likewise how does it sit with the decision in the same Merrett case that Members Agents were not responsible because they too were in the dark? If Agents had the knowledge then, when 13 out of 16 Committee Members are Agents, surely the Committee had the knowledge? Since Lloyd’s centrally cannot abrogate Statutory duties, what significance can we impute to any delegation to the Agents?

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We give a guarded welcome to your Lordship’s suggestion of an Independent Panel and recognise the value of a buffer between contending factions. The suggestion recognises that in pursuit of alleged but unaudited or not independently validated debts, Lloyd’s, like Janus, is prone to say one thing and then pursue a Name beyond the last cufflink through to council house accommodation, State support and into bankruptcy. In broad terms I make seven recommendations:

1. Lloyd’s should agree that the Independent Panel be subject to a Consent Order to bring its authority within the jurisdiction of the Court.

2. Your Lordship will use his good offices to recommend an independent Chairman, someone who is not a Freemason.

3. In the interest of all parties, there should be nomination of a representative on the Panel, one for Lloyd’s, one for UNO Claimants, one for the Legally Aided and one for Independents.

4. For the Court to declare a continuance of all stays of execution, stays on central fund writs for the filing of defences, counterclaims etc, and orders of desist or estoppal on all other Lloyd’s related legal action pending final determination of legal proceedings and/or final determination of the Panel.

5. For the Court to invite financial institutions and all other third parties who provided guarantees to Lloyd’s, to be involved in the Panel’s deliberations and discouraged from upsetting the process by taking pre-emptive action. 

6. As regards the intractable problems of homes charged to support underwriting at Lloyd’s, that the Panel will bear in mind the minimum relief to which a Name is entitled as defined in the Order of Colman J. of 26^th January 2000. To achieve that specific minimal relief, it is obvious that the Panel will require outside assistance and the wherewithal if it is to achieve a resolution. Claimant Names worldwide can therefore be expected to co-operate with the Panel provided its authority and remit allows it to broker a settlement similar to that achieved recently between Mr David West and Lloyd’s. (As the West case shared broadly similar allegations and discovery, I am confident that Lloyd’s will welcome this proposal because the West settlement will surely have reflected the fact that neither Mr. West nor his two daughters risked losing their homes.)

7. As an act of good faith in the Panel, for Lloyd’s to approach it as a medium for resolution by agreeing to wind up the Financial Recovery Department.

8. That the Court recognises the objective of the Panel is not just reinstatement of R & R offers which most litigants were unable to accept, but also recognition of the merits of the substantial claims being advanced in our application to amend pleadings and seek leave to appeal.

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Whilst Litigants in Person recognise the value of an Independent Panel, it is of course far too soon to predict if it can offer a panacea for Claimant Names, let alone bring this litigation to an end. We remain deeply concerned that we have been denied a fair trial and a reasoned judgement. In particular, the Litigants in Person submitted to the will of the Court not to cross-examine Lloyd’s witnesses on the understanding that our closing submissions would be adjudicated upon. None of our submissions, either written or oral, have been mentioned in this judgement. We believe this is a fundamental breach of natural justice and our human rights. We consider Litigants in Person should have had the right to cross-examine. I submit that we were wrongfully denied that right and thereby denied a fair trial. We further consider that the refusal of the Court to allow us inspection of files G and Q is unacceptable and we question whether the Court was right to accept so readily the suggestion that Attorney reports were so privileged when it appears that no such privilege has survived in the U.S.A.

Furthermore, a fair trial was denied us when the Court decided not to call those witnesses which Lloyd’s withdrew without justification. The decision sacrificed the integrity of the Trial itself. If necessary, new precedent should have been made to compel those charged with fraud to attend Court, particularly those witnesses whose evidence was crucial in determining the state of knowledge at the time and who played a seminal part behind the scenes over the Murray Lawrence letter. For the Court to make rash findings in the absence of such crucial evidence and without setting out its reasons 12.. does not speak of justice.

My charge that Lloyd’s sought to manipulate the trial and its result appears to have been borne out by the judgement. It is deeply unsatisfactory that the Judge should have read a number of witness statements by absentees yet drew no adverse inference from their unwillingness to face cross-examination. It is clear to any reasonable man that Names were denied their right to a fair trial as ordained under Article 6 of Part I of the Convention scheduled to the Human Rights Act 1998. Moreover, by failing to take account of the HRA as mentioned above, Claimant Names may wish to consider what remedies may arise under Section 6 of the ECHR, particularly as the Court was put on notice during trial of the Human Rights Legislation and that European Law should be considered in the judgement.

Many Litigants in Person believe this verdict does not comply with their right to a reasoned judgement. There is no reference in it to Litigants in Person, no consideration of their evidence, no consideration of their individual cases. We have been ignored. This is a fundamental denial of justice.

I now turn to a number of other instances where in my submission the judgement is deeply flawed and patently contradicts the evidence which emerged in the trial. I have already referred to the Murray Lawrence letter, the gagging of Rota Officials, the recruitment of Names for capacity far beyond the Market’s needs or requirements, and the off-loading of long-tail liabilities through insider reinsurance. The mere fact that those contracts were subsequently set aside for reasons of material non-disclosure speaks for itself - — that they were not entered into in good faith. Rowland, Murray Lawrence, Hiscox, Skey and Don Tayler as well as many former committee members of Lloyd’s were deeply implicated. And we can add to this catalogue of "failings" the Lloyd’s committee minute of 9th December 1982 which discussed the cost of asbestos claims, and ask why the subject never appeared on the new Council’s agenda thereafter, at least not in documentary form or to the recollection of any external member. These were actions typical of the guilty men at Lloyd’s, evidence which proved how much they knew about catastrophic asbestos horrors in the pipeline, but which the judgement dismisses as matters of little consequence insofar as it examines their state of knowledge at all. What a strange conclusion to draw beside Lloyd’s solicitation in 1983 of an amendment to audit requirements by means of a Statutory Instrument.

The verdict also dismisses and contradicts the proof in trial of actions taken by Lloyd’s hierarchy to suppress the information and prevent it reaching the External Names. In cross-examination Sir David Rowland described the Rota interview as a checking process, yet as one Litigant in Person submitted to the Court, how can you verify that a checking process is complete without mentioning the overhang of long-term APH liability, and without asking questions to determine what people had been told? Inevitably one is forced back to the incriminating evidence that Rota Officials must make no mention of the one single issue which threatened melt-down of the Lloyd’s market and would have put off any Name in possession of his senses from joining Lloyd’s. Equally, the Kiln directive to remove asbestos from the audit instructions points to obsessive secrecy and complicity among Lloyd’s top officials to avoid upsetting the recruitment programme; indeed the Moir memorandum to cajole or bully the Panel auditors into submission if they did not sign off unqualified accounts shows the depth of corruption and crooked state of mind of former Chairmen and their cohorts.

Lest we forget, the Neville Russell letter was sent to Lloyd’s, not to external Names, and Lloyd’s centrally knew that APH infected syndicates could not achieve an equitable RITC because of the impossibility of reserving to ultimate. How did Lloyd’s know? They knew because their own internal Solvency and Reporting Committee provided regular triangulation charts showing non-marine trading years bleeding far into the future. It is my submission that the judgement of the Court is defective in failing to address this central issue and in failing to reach a finding that it was incumbent upon Lloyd’s to tell prospective and existing Names both of the Neville Russell letter and their (Lloyd’s) inability to police an effective and equitable RITC. To conceal the total failure of RITC long tail business from External Names and their Agents, is, I submit, compelling, irrefutable evidence of fraud committed by the Society of Lloyd’s. It is fraud because such non-disclosure aided and abetted the deliberate recruitment of claimant Names.

And it beggars belief that the Court could find so much malpractice acceptable by the Committee and Council of Lloyd’s in the light of official statements made by Mr Jackson to the Senate and by Mr Kellet to the Inland Revenue on behalf of the then current Chairman, yet reserve its strongest criticisms exclusively for those operators outside the uppermost circle of officials. Nor is the judgement on any stronger ground in pronouncing a not guilty verdict if a minority of members possessed secret knowledge, a most peculiar assumption since the Court had previously eschewed the necessity to call reluctant witnesses.

It is patently absurd to say that Lloyd’s is innocent of fraud simply because a purported minority of senior officials deliberately chose to keep quiet and not inform new colleagues such as Sir Eddie Kulukundis and Mr Dennis Fredjohn. It is hardly acceptable lawful practice in England because any crooked Chairman or his Deputy could simply pack a Board of Directors or Council with people ignorant of the true position. If the Court is seriously saying that this is acceptable practice in British commerce, then 3^rd November judgement will throw open the floodgates for rampant defrauding of investors throughout the country.

In an action for fraud, surely the correct yardstick for framing a balanced judgement is a basic standard of commercial honesty. Was it honest of Lloyd’s to encourage recruitment — the membership department target levels spring to mind — when they knew by 1981 that the market was nearly bust? Was it honest of Lloyd’s to cover up the under-reserving of long-tail syndicates in their published accounts? Obviously the answer must be no.

So why did the Court exonerate the Lloyd’s crooks? Why did the Court fail to give due weight to Mr Bryan Kellet’s observation to the Inland Revenue in 1984 that: "we are under-reserved, what concerns us is how the industry can survive its under-reserving." For the Court to accept at full face value Mr Kellet’s explanation that this trenchant observation was mere hyperbole is unacceptable.

We submit that the judgement of the Court is fundamentally flawed in findings of both fact and law and total lack of reasoned analysis. It is an unconscionable apostasy. We do not accept the verdict of this Court that Lloyd’s is not guilty of fraudulent misrepresentations; they knew but did not tell the Names. In three words, omission by deceit.

In summary and to reinforce the above-mentioned complaints, Litigants in Person were wrongfully placed at a substantial disadvantage compared to Lloyd’s by being denied the right to cross-examine witnesses. It is regrettable that the judgement not only excludes all evidence submitted by Litigants in Person but compounds the error by praising Lloyd’s witnesses whilst denigrating evidence given in trial by witnesses for Claimant Names. In my submission, the judgement of the Court shows such prejudice and provides Names with legitimate doubts about the Court’s impartiality.

Clearly we have been denied a fair trial. Accordingly and after serving the appropriate Notice in Skeleton Argument, I now call upon the ‘Court to declare a mis-trial and request the Court to re-try the issues before another Judge. Pursuant to the Maastricht Treaty of 1992 of which the United Kingdom is a signatory, the Court will have noted that member States are expected to co-operate in the judicial process. Accordingly I hereby seek a referral to the European Court of Justice under Article 177 of the Treaty of Rome. I wish the matter of a fair trial to be the subject of the referral and in particular the ECJ’s interpretation of the Objectives and in particular Article K of the Maastricht Treaty. Under Article 177 of the Treaty of Rome I hereby apply for a reference to the ECJ if this is the Court of last instance. This reference is mandatory unless the matter is "acte claire" and assuming this is the Court of last instance. Should your Lordship grant leave to appeal then the referral request would move to the Court of Appeal. If your Lordship does not grant leave to appeal and refuses a referral, then your Lordship must consider the matter "acte claire" and I am entitled to request your reasoning in writing.

I wish to conclude this statement by expressing my regrets for its necessity. I am deeply saddened because the judgement does not appear to reflect the man I learnt to know and respect in 64 days of trial. I share the view of many Claimant Names who detect the hand of political interference which lies athwart the manifestation of undeviating justice in England.

But despite the judgement of this Court, let it be known abroad that our determination to obtain full and proper compensation remains undimmed. Few can deny that Lloyd’s of London is now a national disgrace, a rotten institution which replaced the principle of utmost good faith with another cornerstone in its philosophy, namely the bankruptcy of the former investors on the back of unproven and unwarrantable monetary claims. And many may come to regret the intercession of outside agencies to bring about a final resolution to our quarrel with Lloyds.