Current Law Cases



contract; offer and acceptance; Lloyd's names attaching conditions to settlement offer; no acceptance of counter offer


Jones v Society of Lloyd's


(Ch D) Chancery Division


December 16, 1999


Rattee, J..


Insolvency Rules 1986 (SI 1986 1925) r.6.5(4)




Times, February 2, 2000


J and S, Lloyd's Names, had made agreements with L to settle their liabilities of GBP 302,963 and GBP 187,228, respectively, under the terms of the 1996 settlement agreement. J agreed to pay a single sum of GBP 15,000, with the remainder paid by way of a structured repayment plan, but failed to make the initial payment on time and L presented him with a statutory demand for the full gross sum as shown in his finality statement, without debt credit deductions, as provided for in the settlement agreement. S agreed to pay in cash, but upon failing to do so received a statutory demand for payment in full without deductions. J and S applied for the statutory demands to be set aside, arguing that the difference between the sums originally agreed and the sums now demanded amounted to an unenforceable penalty.


Held, dismissing the applications, that the difference between the amounts shown on the finality statements and the sums net of credits originally agreed did not amount to an unenforceable penalty. The right to receive that amount was a contractual right already existing before the new settlements were agreed and therefore could not be regarded as a penalty for failure to meet the terms of the agreement.




Debts, Lloyds Names, Statutory demands


For J: David Oliver Q.C. and Richard Morgan. For S: Catherine Mackenzie Smith. For L: Edward Bannister Q.C. and Lexa Hilliard.


For J: In person. For L: Solicitor Society of Lloyd's


1998-SD-688, 1998-SD-9580

Joined cases

Standen v Society of Lloyd's