Landmark PII Case going to Commercial Court Trial on 28th July 2015
The trial of AIG Europe Ltd –v- OC320301 LLP & Ors, which concerns the Solicitors Minimum Terms of Cover, will be the most significant development in the area of claims aggregation under PII policies since the House of Lords decision in Lloyds TSB General Insurance Holdings and Ors v. Lloyds Bank Group Insurance Company Limited as far back as 2003. The importance of the case has led both the Law Society and the Solicitors Regulation Authority to intervene as matter of professional and public importance.
Royds LLP acts for the professional trustees in two trusts and over 200 individuals who invested in residential property developments in Turkey and Morocco and who lost their money in 2009 as a result of the alleged negligence of the now defunct firm The International Law Partnership LLP. The firm’s run-off insurers AIG Europe Ltd have brought the claim against their insured seeking a declaration that their limit of indemnity for all claims is capped at no more than £3m. AIG relies on the wording contained in the Solicitors’ Minimum Terms of Cover approved by the Law Society in 2005, following the earlier Lloyds TSB decision. The insurers argue that their liability is limited on the basis that the hundreds of claims brought by the individuals can be aggregated into a single claim for insurance purposes. Royds LLP’s clients have been joined as additional defendants to oppose the insurer on behalf of all the trusts’ beneficiaries.
The trial commences in the last week of the Summer term at the Commercial Court, Rolls Building and is due to last a week, with judgment expected later in the year. Royds LLP’s Partner, Richard Woodman, expects this case to be a landmark ruling that will directly affect not only the solicitors profession, but any professional who carries a PII policy, and possibly beyond to other insurance products.
Richard Woodman said: “When the losses came to light, claims were brought against The International Law Partnership LLP and its partners, who were acting as the professional trustee for two trusts benefiting over 200 investors. The firm has now gone out of business and into run-off%