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Lloyd's Names watch as boss goes into
Marcus Scriven reports on the proceedings as a key witness-- a former Lloyd's chairman-- takes the stand.
The tape mysteriously removed from the answering machine not long after its owner's death. . . The opening bat for the Winchester XI. . . The resignation from the Garrick, so bitterly felt. . . And the little matter of £9 billion, lost in a few short years. The case now being heard at 91, Chancery Lane could only ever concern Lloyd's, London's insurance market, which has been mired in scandal for more than a decade.
What should prove to be the last of this saga-- one that has lead (sic) to dozens of suicides, as well as hundreds if not thousands of suddenly impoverished lives-- is now being played out beneath the unwavering gaze of Mr Justice Cresswell. The courtroom is incongruously modern-- upholstered blue chairs, tables of lurid blond wood, fallible air-conditioning. The minutiae of the case is dense, clotted, filled with abbreviations, jargon and figures.
But, in essence, the argument being put forth on behalf of a handful of Names (as Lloyd's investors are known) is simple. It is that the Lloyd's hierarchy knew as early as 1979-80 that claims arising from asbestos-related disease were going to be catastrophic and that instead of drawing this unpalatable fact to the attention of Names-- as well as prospective Names-- Lloyd's asserted that the market was robustly solvent. This, it is claimed, was fraud.
The titular head of the Names' action is Sir William Jaffray, 48, fifth baronet. A tall figure, he looks tired but cheerful, probably because he has attended court every day (nearly 40 so far).
In theory, Lloyd's does not have its own leader, but 33 individuals, among them former Lloyd's chairmen Sir David Rowland, Sir Peter Miller, and David "Porkie" Coleridge, who according to the Names, constituted the "corporate mind" of Lloyd's, and consequently knew precisely to what degree the Names were being duped. (sic)
As far as the Names and most observers are concerned, however, the man who matters most to Lloyd's is another former chairman, Murray Lawrence. Lawrence was cross-examined for the first time two days ago.
Simon Goldblatt, QC, is counsel for the Names, whom, it is said, he is charging only a fraction of his usual fees.
Murray Lawrence, an ample man of 65, was asked how long it had taken to prepare his witness statement. A couple of months, he replied. Mr Goldblatt suggested that Mr Lawrence had experience giving evidence before. Murray Lawrence agreed that he had. Mr Goldblatt referred to an occasion in the USA, when Mr Lawrence had had three preparatory sessions before giving evidence.
Mr Goldblatt wondered how long Mr Lawrence had been "in the nets" on this occasion.
Perhaps Mr Lawrence expected and intervention from the counsel for Lloyd's, Charles Aldous, QC. It was not forthcoming. "Something like 10 days," he said, acknowledging time spent in the offices of Freshfield's, Lloyd's solicitors.
That may sound excessively cautious for a man of Mr Lawrence's talents-- not only an opening bat, but a golfing blue, and the first chairman of Lloyd's to have entertained the Queen Mother to tea there, if also the first chairman not to be knighted.
But the nets were needed: after all, the disaster caused by asbestos, and the regrettable events that followed it, were a long time ago, so long ago, in fact, that they have frequently eluded Mr Lawrence's memory.
During his first spell at the crease, he barely offered a stroke. Sometimes he simply couldn't recall what was asked of him; he suggested that he might remember if there were a document in front of him.
Mr Goldblatt asked what, precisely, had been the nature of Mr Lawrence's underwriting activities. Much of his work, explained Mr Lawrence, had involved resolving a computer leasing problem.
"Let's have a few bits of clarification," suggested Mr Goldblatt, before asking when Mr Lawrence's work as the computer-leasing working party had concluded. "In either 1982 or 1983," replied Mr Lawrence.
How many days a week did the working party meet? Not very often, conceded Mr Lawrence. But as its chairman, he added, he spent a great deal of time on it. There had been a lot of trouble setting up a satisfactory system with the Bank of Boston. Besides which he had been obliged to do plenty of travelling.
Mr Goldblatt altered the tack: "What are the characteristics of a good underwriter in the Lloyd's market?" Knowledge of business, replied Mr Lawrence, as well as being a good negotiator and assessor of risk. A good memory might be useful too, might it not? It would be a great help, agreed Mr Lawrence.
Mr Goldblatt wondered how Mr Lawrence rated his own abilities as an underwriter. Mr Lawrence said that was something for one's peers to decide. Proceedings paused for a few minutes. With Mr Lawrence temporarily off the field, those in the public gallery could allow their minds to drift back to an earlier passage of play, when Mr Harvey White had been at the crease.
Mr White had been an old friend of John Osbrey, a Lloyd's Name who had lost so much money that he had felt obliged to resign from the Garrick some time before dying last year. Mr White and Mr Osbrey had been at school together-- at Winchester with Murray Lawrence. Mr White remembered how, subsequently, while up at Oxford, John Osbrey had shared digs with Mr Lawrence.
Years later, Mr White had added, Mr Osbrey had been dismayed to hear that Mr Lawrence was denying that he had ever known him (Mr Osbrey) at Winchester or at Trinity College, Oxford.
It was after Mr. Osbrey's death that a tape was removed from his answering machine (apparently for safekeeping).
Before yesterday's session, Mr Justice Cresswell inquired about the tape's whereabouts. It appears that it may be in the hands of one of Mr Osbrey's cousins. It remains to be seen whether the tape turns up and, if so, what its significance will be.
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