Society of Lloyd's (Plaintiff) v Terence William Fraser & ors (Defendants) (1998)
QBD Commercial Court (Tuckey J) 4/3/9Interpretation of Equitas Reinsurance Contract in hearing on quantum issues. In an earlier judgment (22 January 1998) in these RSC O.14 proceedings it had been decided that Lloyd's had produced evidence which complied with cl.5.10 of the Equitas Reinsurance Contract (the Contract) under which it sought to recover premium against Names who did not accept the R&R settlement. At that time only sample records and calculations were produced but reports had subsequently been produced for each of the remaining 570 Names against whom the proceedings continued. The present hearing was concerned with cl.5.10, which provided that, "for the purposes of calculating the amount of any Name's Premium... and the amount of any Name's Premium discharged by the transfer of assets or the amount realised through the liquidation of funds at Lloyd's for application in or towards any Name's Premium, the records of and calculations performed by the (MSU) shall be conclusive evidence as between the Name and (Equitas), in the absence of any manifest error". The issues before the court were: on the debit side (the Name's Premium) (1) whether Lloyd's had proved its case at all; (2) whether the premium included Name's personal expenses; and on the credit side (transfer of assets or liquidation of Funds at Lloyd's) (3) whether Names had shown manifest errors in the reports now produced by Lloyd's. Threshold questions were raised as to (i) whether cl. 5.10 applied to all credits; (ii) what could be relied on to demonstrate manifest error; and (iii) the effect of cl.5.5 of the Contract.