LLOYD'S INVESTORS SUE LAW FIRM, SEEK COMPENSATION FOR LOSSES

LLOYD'S INVESTORS SUE LAW FIRM, SEEK COMPENSATION FOR LOSSES

A prominent international law firm is being sued by Lloyd's of London investors who suffered crippling losses.

Clyde & Co. became embroiled in the litigation surrounding Lloyd's Monday after the Sturge Names Action Group (SNAG) started its legal bid to sue the firm.The action relates to the part played by London-based Clyde & Co. in the management of underwriting syndicate 210 - one of the individual underwriting entities at the insurance association.

The syndicate, the largest non-marine syndicate in Lloyd's during the 1980s, has declared losses of over 350 million pounds ($525 million) for 1990 to 1993, partly due to disastrous U.S. pollution and asbestos policies written by the syndicate. Clyde & Co. acted for the managers of the syndicate.

SNAG's case against Clyde & Co. revolves around a decision by the syndicate managers to cancel a reinsurance policy giving investors, or Names, unlimited protection from pre-1969 asbestos and pollution policies. Sturge received $80 million in return for canceling the policy.

SNAG, which represents over 4,000 Names, already is suing the syndicate managers, the agents that recruited the investors onto the syndicate, and the auditors of the syndicate's accounts.

''Nothing can compensate our membership for the humiliation they have suffered by the betrayal of their trust in Sturge and those who encouraged them to believe that Sturge - the largest agency in Lloyd's - chaired by David Coleridge, the immediate past chairman of Lloyd's, was safe and low risk," said John Rew, chairman of the Sturge Names Action Group.

"We are confident that the actions we have instituted, including those against syndicate auditors and solicitors, will produce some recompense for the loss."