Battle lines are being drawn in the fight between London Underground Ltd (LUL) and two top law firms. The £140m claim by LUL is one of the largest professional negligence claims ever issued against a firm.
The Lawyer reports that law firms Freshfields Bruckhaus Deringer and Herbert Smith will fight the case in the High Court, enlisting Laurence Rabinowitz QC and Tim Dutton QC respectively.
London Underground accuse the firms of giving negligent advice in 2003, over an agreement with the doomed transport company Metronet to renovate seven Underground stations. At issue is whether London Underground could have paid out less money if/when the partnership turned sour.
After Metronet collapsed in 2007, LUL had to buy £1.74bn in debt, based upon a previous ‘put option’ agreement. LUL argue this figure could have been substantially reduced, had they been allowed to buy the debt at the lower market rate. They claim that Freshfields and Herbert drafted and approved the put option without referring to LUL.
The case will be heard this October.
Source: The Lawyer