Judgement Delivered in the  trial  Lenderink-Woods v Zurich

On 19th December 2016 Mr Justice Norris, sitting as Vice-Chancellor of the County Palatine of Lancaster, delivered his reserved judgment in  the case  of Lenderink-Woodsv Zurich [2016] EWHC 3287 (Ch)  in which Richard Oughton represented the Claimant.  The case concerned life-insurance bonds  and  Gift and Loan Trusts which the Claimant took out upon the advice of a tied agent for Allied Dunbar ( now Zurich).  The life-insurance bonds and Gift and Loan Trusts were taken out as a result of erroneous advice as to the  potential liability for  Inheritance Tax. The trial, which lasted 4 days, took place in Manchester in July 2016 and involved hearing witnesses by video link from the Gulf, California and Costa Rica.

Mr Justice Norris found for the Claimant and awarded £220,000 by way of damages.

The judgment is significant in that:

  1. A tied financial adviser would be liable for not offering “suitable” advice, if he advised a client to take a product from his tied range, but there was a far better product available which was not within the tied range. It was not an answer to liability that by inadvertence the product achieved the objective, if there was a better and cheaper product on the market, even though it was not available from that particular provider;

  2. In determining whether a product was “suitable”, the charges were a  highly relevant consideration;

  3. Expert evidence as to the “suitability” of the product was  not determinative when a Judge was able to form his own  view as to “suitability”;

  4. The prior decision of the Financial Ombudsman in favour of Zurich was shown to be completely erroneous.

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