The case could lead to a multi- million pound payout by Clifford Chance, the City's biggest law firm.
In 1987 Caledonian Investments, owned privately by the Cayzer family, sold its stake in the B&C financial conglomerate to the management of the company, then headed by John Gunn, for pounds 427m.
The banks advised by Clifford Chance guaranteed a pounds 164m payment by B&C to Caledonian. When B&C defaulted, the banks were left with the bill.
B&C went into administration in June 1990 after the acquisition of Atlantic Computers for pounds 407m went wrong. More than pounds 550m had to be written off and all B&C's subsidiaries were put up for sale.
BZW is claiming damages against Clifford Chance for 'breach of contract and/or duty and/or negligence and/or innocent misrepresentation and/or negligent misstatement and/or for an indemnity and/or contribution'.
The claim is based on five main areas, the first covering all information about B&C provided to the banking syndicate between June and October 1987. The second concerns proposals for a scheme of arrangement whereby B&C bought the majority of its own shares from Caledonian.
The claim also mentions a document setting out these proposals, sent in April 1987 to holders of pounds 320.5m of debt, or 7.75 per cent convertible subordinated unsecured loan stock 2000.
Finally, the writ outlines the purchase by B&C of more than 21 million ordinary stock units held by Caledonian for pounds 100m before the court's sanctioning of the scheme of arrangement.
The claim also refers to previous proceedings brought by the syndicate against B&C.
The syndicate advised by Clifford Chance included Barclays Bank, Banque Paribas, Hongkong & Shanghai Banking Corporation, Royal Bank of Scotland, Standard Chartered and Creditanstalt-Bankverein.
No one from Clifford Chance was available for comment last night. A spokesman for BZW confirmed that protective proceedings had been launched against Clifford Chance, but declined to comment further.
A Department of Trade and Industry inspectors' report into Atlantic Computers is due this year and is likely to form the basis for claims against parties who advised on the acquisition. Administrators from Ernst & Young, who are running B&C on behalf of the courts, are considering what action to take.
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