Lloyd's Names were this week back in the High Court in an action which they hope will pave the way to sue Lloyd's for negligence.

The Names, represented by the United Names Organisation (UNO), are seeking leave to amend their pleading against Lloyd's from fraud to one of negligence.

The hearing, which began yesterday (Wednesday, April 25), is expected to last two or three days.

At the heart of the action is the argument by Names that the European Union Human Rights Act, which came into force in the UK last October, removes the Council of Lloyd's immunity from prosecution.

Under Section 14 of the Lloyd's Act, the council cannot be sued for negligence. But UNO points to a section of the Human Rights Act that says everyone has the right to a civil resolution of a dispute in a court.

If the court refuses to allow the plea amendment, the Names will go to the Court of Appeal and, if necessary, the European Court of Human Rights, said UNO chairman Catherine Mackenzie Smith. “We believe the Lloyd's Act is a contravention of the new Human Rights Act,” she said.

The Names' belief that Lloyd's was negligent comes from comments by Justice Cresswell at the time of the Jaffray case last year when Names alleged Lloyd's had concealed the true scale of asbestos losses from the market in the seventies and eighties.

The judge said there had been no fraud, but accused Lloyd's of a catalogue of failings and incompetence.

Lloyd's position is that if there is a contradiction between two acts of parliament, it is the government that would have to be sued.

In a statement Lloyd's commented: “Lloyd's considers that the Names' application to amend their pleadings to proceed with claims in negligence, including their arguments in respect of the Human Rights Act, has no substance and is confident that the court will dismiss it.”