Lloyd's to pursue names for legal costs

Lloyd's of London is preparing to pursue 220 names for legal costs that could be as high as £25m if it wins the five-year case against them that is currently with the Court of Appeal.

Lloyd's has been in dispute with different groups of names for a decade. Most of that action is now over and in many cases Lloyd's has not pursued its legal costs.

The remaining case, involving 220 individuals, began in 1997 and is led by the name Sir William Jaffray. Sir William's group allege Lloyd's governing body knew asbestosis claims would rocket in the early 1990s and deliberately attracted individuals into the market to get them to help shoulder the financial burden.

The Jaffray case went to the Court of Appeal in March and a decision is expected to be handed down this month. Lloyd's won the High Court case and observers believe Lloyd's will also prevail in the Court of Appeal one.

The dispute between Lloyd's and the individuals who have invested in its market, known as names, has been acrimonious. Some names even committed suicide in the 1990s because they could not meet the enormous bill for claims they faced because they underwrote the market on an unlimited liability basis.

Lloyd's is anxious not to pre-judge the Court of Appeal decision and would not confirm its intention to go for costs from names. A spokesman said: "We will wait for the outcome before commenting in detail."

But it is understood that the society believes while there have been some genuine cases of hardship in the past, some names are easily able to pay outstanding claims as well as their legal costs. Lloyd's is likely to be selective about who it pursues, going after those who have the funds to cover the legal costs.