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Cubism Law secures High Court victory

Cubism Law secures High Court victory

Cubism Law secures High Court victory for three senior underwriters in claim against specialist insurer Neon Underwriting for breach of employment contract. The judge found, exceptionally, that the employer had committed several repudiatory breaches of the claimants’ contracts. Neon’s counterclaim, which included allegations that two of the underwriters had caused losses totalling circa £2,700,000, was dismissed in its entirety. See the full press release below.

In a High Court judgment issued on 10 August, Mr Justice Choudhury found in favour of three senior underwriters in their claim against Neon Underwriting, a Lloyd’s of London syndicate, for unpaid salary increases, bonuses and profit commission, as well as damages for wrongful dismissal and a declaration that two of the underwriters, who had resigned without notice were released from their post termination restrictions.  The judge found, exceptionally, that the employer had committed several repudiatory breaches of the claimants’ contracts.  Neon’s counterclaim, which included allegations that two of the underwriters had caused losses totalling circa £2,700,000, was dismissed in its entirety.

 The case was brought against Neon in July 2018 after it insisted that its employees Robert Brown, Dawn Bhoma and Astrid O’Reilly agree to new, less favourable, contract terms or forfeit the pay rises and discretionary bonuses they had been awarded.  Neon also miscalculated, and sought to withdraw, the profit commission scheme that had been agreed with Neon’s previous management team. 

 After Mr Brown and Mrs Bhoma handed in their resignations Neon alleged that they had breached their contractual and common law duties of confidentiality and reported them to Lloyd’s of London for the same without properly investigating the allegations it had levelled against them.  Neon also informed them that it no longer had trust or confidence in them, and made numerous other claims regarding their conduct.  

In his decision, following a 6 day trial, Mr Justice Choudhury said that Neon’s claims of wrongdoing were “without justification”. He ruled that Neon committed multiple repudiatory breaches of Mr Brown’s and Mrs Bhoma’s employment contracts and that they had been wrongfully dismissed. All three will recover their unpaid pay rises, unpaid discretionary bonuses and miscalculated “profit commission”.

The case presented Cubism Law with a number of logistical and practical issues, including the need to seek urgent advice from leading counsel on the clients’ circumstances, prepare for a “speedy trial” in the High Court against a well-resourced opponent and the need to continually advise on a dynamic employment situation in which the clients’ personal reputations in a small market needed to be protected. 

 “It was a tough time for Rob, Dawn and Astrid, and they had to make some difficult decisions.  We did everything we could to improve their chances of success and to minimise the risks to them” commented Stephen Bane, solicitor, who led the Cubism team.  He continued: “We have a fantastic team here and with so much work to do in such a short timeframe it was all hands to the deck.  We’re all proud of what we achieved for Rob, Dawn and Astrid”. 

His colleague Anjan Patel agreed, and added: “The judgment should make sobering reading for any employer looking to change their terms of employment, especially in relation to salary, commission or bonuses.  The important message for both employees and employers is that proper legal advice must be taken at an early stage.”

The case is ongoing: the value of the claims for wrongful dismissal and the profit commission are yet to be determined.

Cubism Law team:  Solicitors: Anjan Patel, Head of Commercial Litigation, Stephen Bane and Arunas Andriuskevicius, supported by Farah Bandali (Trainee solicitor) and Jay Mutturaja (Paralegal).

 Essex Court Chambers team: David Craig QC and Stephen Donnelly.