Beckett and ex-Towergate employees to pay estimated £1m in damages and legal costs
Towergate Partnership has accepted a substantial settlement from Bob Beckett and his co-defendants to resolve the dispute over the breaching of restrictive covenants by Beckett and former Towergate employees who joined him at Insurance Risk Solutions in Bury St Edmunds at the start of 2007.
As part of this settlement, Beckett has made an unequivocal apology and the defendants are paying £825,000 to Towergate for damages and costs, as well as picking up their own legal costs.
This follows a pre-trial hearing in March (Towergate Underwriting Group and others v Total Broker Solutions and others) at which the Judge’s summing up highlighted a number of breaches, including Beckett’s premature preparation to trade during the restricted period binding him following his sale of Beckett Group to Country Mutual Insurance Brokers.
During the hearing, the former Towergate employees were also ordered to comply with their respective covenants.
Towergate executive chairman Peter Cullum said: “This case has been about integrity, honesty and morality and I expect that this ill-advised journey has not only caused Mr Beckett financial harm, but personal discomfort given his former position on the CII Professional Standards Board.
“The outcome is of outstanding significance to any professional services firm, particularly in the insurance industry where you hear all too often that ‘covenants are not worth the paper they are written on’.
"It is natural in all companies that some people will seek to pursue their career elsewhere, but the message is clear – you disregard your contractual obligations at your peril.
“We pay top dollar for businesses we acquire, so we do not expect vendors to look to reclaim the business they have sold. This would be like buying a house then finding the previous owners trying to move back in.
“As for Mr Beckett’s co-defendants, it was extraordinary to find experienced practitioners displaying such a naive disregard for their covenants when attacking their former colleagues.
"Undoubtedly this episode has been a real distraction for Towergate, but I am extremely proud of our team in Bury St Edmunds, who have acted with great dignity throughout.
"Their fortitude, and the addition of Alliance Insurance Management, keeps us exceptionally well placed in this region as we seek to grow organically and by further acquisitions.”