Ernst & Young to face massive Equitable claim
Ernst & Young must face a multi-billion pound action after the Court of Appeal reinstated the bulk of Equitable Life's £2.6bn claim against the Big Four firm.
Link: Equitable report may not appear in full
Speaking at the London Court of Appeal this morning, Lord Justice Brooke said that it has ‘substantially allowed an appeal by Equitable Life Assurance’.
The effect is that the court has restored both lost sale and bonus declaration claims. Equitable claims that the business could have been sold for £2.9bn if E&Y had offered proper advice on the true cost of guaranteed annuity rate policies.
Victoria Cochrane, partner and general counsel for Ernst & Young, said: ‘We knew there was a risk that, given the complexity of the factual background, the Court of Appeal would conclude that a full examination of the facts at trial is required.’
The case is expected to go ahead around Autumn 2004.