DATES: 27 JULY 2007

HEADNOTE: The Names sought to amend their pleadings to include a claim of misfeasance in public office on the part of Lloyd’s. The application was dismissed as part of a number of rulings given in the proceedings. The judge was of the opinion that Lloyd’s was not a public officer and thus could not be the subject of a claim for misfeasance in public office. The Names appealed to the Court of Appeal.

The Names contended, inter alia, that the powers of the Council of Lloyd’s in relation to the affairs of members, and the special position that Lloyd’s held under the Insurance Companies Acts, indicated that it was a regulator of at least the part of the insurance market occupied by Lloyd’s underwriting, and thus performed public functions, which in turn indicated that it was a public body for the purposes of the tort of misfeasance in public office. The names also relied on s 6(3)(b) of the Human Rights Act 1998 to argue that as a public authority under s 6 of the Act could include a body only some of whose functions were of a public nature, it followed that the fact that some of its functions were not, on any view, public did not affect the status of Lloyd’s as a public officer.

COUNSEL: David Foxton QC (instructed by Freshfields Bruckhaus Deringer) for Lloyd’s; Three Names appeared in person; Phillip Jenkins (instructed by Grower Freeman) for the remaining Names.

PANEL: BUXTON, SMITH AND MOORE-BICK LJJ

DISPOSITION: The appeal would be dismissed.

Lloyd’s was not a public officer for the purposes of the tort of misfeasance in public office. The public interest in the Lloyd’s insurance market being properly regulated did not make Lloyd’s the regulator, much less a public body. Further, the structure and operations of Lloyd’s, and the management of the affairs of Lloyd’s, was an exercise in commerce, not an exercise in government, however that latter expression was understood. Section 6 of the 1998 Act was irrelevant to the issue in question because whether a body was a public officer under the tort turned on what the body was, and not on what it happened to be doing for the moment.

The requirement that the subject of misfeasance in public office should be a governmental body derived from the very nature of the tort. None of the guidance on the tort in previous authorities made sense, save in relation to bodies that had been given governmental powers, namely the power to interfere with the way in which other citizens wished to conduct their affairs. That could not possibly be said of a commercial operation like Lloyd’s, which was concerned with the internal commercial interests of its own members.

Gershmann v Manitoba Vegetable Producers Marketing Board (1976) 69 DLR (3d) 114 at 123, Three Rivers DC v Bank of England [2000] 3 All ER 1, Ammoo-Gottfried v Legal Aid Board (unreported, 1 December 2000) and R (on the application of West) v Lloyd’s of London [2004] 3 All ER 251 at [38-9] applied; R v Lloyd’s of London, ex p Briggs [1993] 1 Lloyd’s LR 176 at 185 and R (on the application of West) v Lloyd#146;s of London [2004] 3 All ER 251 considered.

Decision of Andrew Smith J [2005] All ER (D) 155 (May) affirmed.