Court of Appeal

Published October 9, 2007

Society of Lloyd’s v Henderson and Others Lowe and Others v Society of Lloyd’s Society of Lloyd’s v Stockwell and Others

Before Lord Justice Buxton, Lady Justice Smith and Lord Justice Moore-Bick

Judgment July 27, 2007

The Society of Lloyd’s was not a public officer for the purposes of the tort of misfeasance in public office.

The Court of Appeal so stated in a reserved judgment dismissing appeals, and an application for permission to adduce fresh evidence, arising out of the judgment of Mr Justice Andrew Smith in the Commercial Court of the Queen’s Bench Division ([2005] All ER (D) 155).

The judge had dismissed an application brought by Lloyd's names known as “the UNO names" (Henderson and others) to amend the pleadings, in long-standing litigation, by adding a claim of misfeasance in public office.

The judge, having found that Lloyd's was not a public officer in the sense required by the tort, dismissed the UNO application as well as the Lowe and Stockwell applications, which turned on the same issue.

Mr Philip Jenkins for the principal applicants; Mr Kenneth Adams in person, with leave of the court, for Mrs Heather Adams; Mr Sydney Michael Butler in person; Mr David Foxton, QC for Lloyd’s.

LORD JUSTICE BUXTON said that the elements of the relevant tort were definitively set out in Three Rivers District Council v Bank of England (No 3) ([2003] 2 AC 1). Further, in Amoo-Gottfried v Legal Aid Board (unreported [2000] EWCA Civ 301) Lady Justice Hale stated at paragraph 27, that the tort was directed at “the exercise of power by a public official, not for the purpose for which it was given, but for some ulterior or impermissible purpose, knowing or being reckless as to whether it will damage the plaintiff”.

However, there was a paucity of general authority as to how the term “public officer” was defined, although there were two observations in Three Rivers, namely: per Lord Steyn (at p190) that “the rationale of the tort is that in a legal system based on the rule of law executive or administrative power may only be exercised for the public good" and, per Lord Hobhouse of Woodborough (at p229) that the tort concerned “the acts of those vested with governmental authority and the exercise of executive powers".

Lloyd’s did not exercise governmental power; and, as Lord Justice Brooke stated in R (West) v Lloyd's of London[2004] 3 All ER 251, paragraphs 7 and 38-39), “the objectives of Lloyd’s are wholly commercial ... and it was impossible to convert it into a body exercising public functions itself within the meaning of the Strasbourg case law", or, it should be added, at all.

It was true that misfeasance in public office was a tort in private law where the nature of a defendant was an element in the definition of liability, whereas in judicial review the nature of the defendant was an element in the jurisdiction of the public law court; but the persuasive relevance of the observation was not thereby reduced.

Since Lloyd’s was not a public officer for the purposes of the tort, the appeals and application to adduce fresh evidence failed.

Lady Justice Smith and Lord Justice Moore-Bick agreed.

Solicitors: Grower Freeman; Freshfields Bruckhaus Deringer.

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