LMIB agrees to pay half of former employee Mills’ legal fees in dramatic turnaround
Courtroom slanging matches are rarely as explosive as this. Marine broker Kevin Mills and his former employer, London Market Insurance Brokers (LMIB), spat fierce allegations at each other before their High Court showdown was stopped short this week.
When LMIB alleged Mills stole its clients, Mills countered with a barrage of allegations of bullying at the hands of senior staff.
But a dramatic turnaround saw LMIB, which was seeking a court order against Mills and up to £50,000 in damages, agree to drop its claim and settle with Mills out of court, paying him half his legal fees as part of the settlement.
In turn, Mills agreed to drop a separate employment tribunal case against LMIB director Daniel Lott and abide by restrictive covenants in his contract for six weeks.
Mills, a leading marine broker, was working at John Cahill & Co when it launched LMIB in 2003. He signed a new contract of employment in January 2004, when LMIB became his new employer.
The contract contained a restrictive covenant preventing employees dealing with clients of LMIB when they leave the company, which Mills did in the summer of 2007.
In a High Court writ dated 16 October 2007, LMIB alleged that Mills had breached the restrictive covenant in his contract.
It sought damages for lost brokerage and a court order banning Mills from further breaches of the covenant. Further, LMIB alleged that Mills had travelled to Egypt to visit his old LMIB clients. Mills hit back in a defence, also filed with the High Court.
In it, he claimed that he had not been made aware of the restrictive covenant when he signed the contract, and that he had, therefore, signed it on the basis of a misrepresentation.
The defence went on to say that LMIB had itself breached the contract through bullying and intimidating behaviour on the part of its directors, allegations which LMIB strongly denies.
Mills claimed he was repeatedly bullied by Philip Cahill and Daniel Lott while at LMIB.
Mills alleged that, in February 2007, Cahill swore at him when he informed him that his fiancée was pregnant.
Mills also alleged that Cahill generally referred to his clients in a derogatory manner and ignored Mills’ request to refer to them with more respect.
Further, Mills alleged Lott became aggressive towards him in February 2006 and July 2007.
In the latter case, he said Lott told him in front of other employees that he was “taking the piss” for failing to complete two administrative tasks.
The defence also alleged that Cahill damaged Mills’ reputation and caused a conflict of interest by instructing that he must only place clients’ business with one of the Cahill underwriting agencies.
Lott said in a statement: “LMIB and its officers categorically deny the ridiculous allegations concerning aggressive behaviour and language made by Mr Mills.
“We also deny the allegations of conflict of interest, or that Mr Mills ever brought any concerns of this nature to our attention.
“The regulations of the FSA and Lloyd’s, which apply to LMIB, do not allow such a conflict of interest as alleged by Mr Mills.
“Neither the court nor the employment tribunal has made any findings on the allegations made by Mr Mills which are entirely without foundation.”