Lloyd's Names face financial ruin after High Court defeat

Lloyd's of London, the insurance market, won a court victory yesterday to bankrupt two more of its private investors, one of whom is still working at 80, in pursuit of debts for asbestos claims.

Lloyd's of London, the insurance market, won a court victory yesterday to bankrupt two more of its private investors, one of whom is still working at 80, in pursuit of debts for asbestos claims.

Heather Adams and Richard Carter were asking the High Court for permission to appeal the debts Lloyd's is claiming against them, which will make them bankrupt. They wanted the debts, which amount to around £500,000, set aside and claim that they have been calculated arbitrarily, without full explanation of how they have been arrived at. However, they failed to convince the judge there had been a "manifest error" in their calculation, and are due in the bankruptcy courts on Wednesday when Lloyd's will serve petitions against them.

Ken Adams, who was defending his wife, said the couple had been the "victims of tyranny" by Lloyd's, which was almost crippled by asbestos claims in 1993 but is now enjoying record profits again. At least 15 Names committed suicide in the face of their unlimited losses. Mr Adams argued that they had twice offered to settle their losses with Lloyd's, raising money from family and friends that came close to meeting the claim originally made by Lloyd's. But instead of accepting the funds, Mr Adams claims that Lloyd's simply added the sum they had raised on to the original debt, which over the course of two years spiralled from £26,000 to £229,000.

"Mrs Adams has been treated grossly unfairly by Lloyd's. The inflationary and arbitrary variations of the debt make it manifestly unfair. We were never wealthy people and we have already paid more than £300,000 to Lloyd's," Mr Adams said. Mrs Adams was made a Name as a gift from her father, who invested £19,000 for her in the market as a nest egg. She says it has been a curse on her life.

Mr Carter said there had been errors in how his debt of £250,000 had been calculated. He has already paid about £450,000 and was forced to sell his house. "They are now asking me for another £250,000 - there is no way I could find it. I am 80 and still earning a living because I have had to," he said.

Lloyd's has always maintained that it has treated all of its Names fairly, that it has offered them generous financial assistance packages and that bankruptcy proceedings are taken only in extreme cases.