Ocean Marine liquidation threatens lucrative work

The provisional liquidation of shipping insurance provider Ocean Marine Mutual is threatening to cut short a mountain of lucrative legal work for UK law firms.
Ocean Marine Mutual has been engaged in a series of long running disputes with a number of parties including its Australian reinsurer, FAI, represented by Clyde & Co, one of eight law firms which is acting in connection with the insurer.
But the Turks and Caicos Islands-based independent protection and indemnity club, which provides third party insurance to ship owners, slipped into provisional liquidation on 4 March under an application made by creditor Midland Bank, believed to be owed in the region of US$50-100m.
Ernst & Young is the appointed provisional liquidator and is being advised by Herbert Smith.
Ray Bell, partner at Clyde & Co, who was appointed in 1997 to advise on a reinsurance dispute with Ocean Marine Mutual, says: “It is up to Ernst & Young to form its own merits on pursuing the matters in court.”
But Bell says: “It could mean the end of legal proceedings.”
Also unsure of the next move is Tony Rooth, partner in the litigation department at Watson Farley & Williams, which has been representing the Turkish Ship Owners Committee since the beginning of the year.
“At the moment I just don't know. The case depends on the actions of other people,” says Rooth.
Chris Hill, joint provisional liquidator at Ernst & Young, was unable to confirm how many creditors were owed money, or how much was in question. He says: “Allen & Overy will be considering the various legal matters. We will be giving our view as liquidators on the merits on various actions.”
Ince & Co is believed to be acting on behalf of members of the Ocean Marine Mutual, while it is understood Barlow Lyde & Gilbert is representing Ocean Marine Mutual in its claims against FAI.
Bob McCunn, partner in the commodities department at Shaw & Croft, acting on behalf of lawyers, surveyors and correspondents owed money by the shipping insurer, says: “The first job is to find out what is going on with the liquidation.”