Chapter 25
Most brokers and underwriters respect each other. There are of course, exceptions to the general rule. Many have worked on both sides of the fence as poacher and game-keeper. Brokers sell risk and buy cover. Underwriters buy risk and sell cover. Brokers resent grovelling for the cover they need ; underwriters resent being taken for a ride : very quickly, offence is repaid when one denies business to the other. Gossip and rumours are easily circulated and reputations trashed. Everyone in the market has friends and enemies.
Ashby left Meredith, Wells and the others to organise a plan of campaign. By now, it was almost five o’clock. He hadn’t far to go to see Stuart Grant in Trinity Square – the meeting was at Grant’s office. The brokers had assumed that because Ashby was going to them rather than them going to see him, that he was desperate to do a deal.
Meredith’s mention of a five per cent success rate, led Ashby to consider a nuisance payment. Even though a million would stretch their reserves, it was a decent enough offer to be rid of the Greeks. Any more though, was out of the question.
As he walked, he thought about what he wanted from the shipowners. Ideally, the talks should prompt a stalemate. His short-term objective was a ‘drop hands’ settlement with the court case frozen and minimal or no payment.
Meanwhile at Trinity Square, Grant was waiting in a conference room which had a view down the Thames beyond London Bridge. The sun was still high above the river when Ashby made his entrance.
“Robert – pleased to meet you – Stuart Grant. May I offer you something ?” There was always a selection of drinks in the meeting rooms. Ashby asked for a single malt whisky.
Grant fixed himself a vodka over ice and said “Right – let’s make a start, shall we ? Help yourself to a cigar,” and he opened a large silver cigar case of Cohibas. Ashby lit one, sat back and waited. He signalled his readiness to listen by looking inscrutably at the ceiling as the smoke drifted upwards from his cigar.
Grant took a file of papers from his bulging leather folder. Wellbourne had told him all there was to know about Ashby – that he was proficient in applied maths and would be three moves ahead at any time.
“Before we begin, let me say Robert that we were decimated to hear of your father passing away recently. It must have been difficult for you when you were in Houston….” And as a master of false humility, Grant continued on in the same way about the great respect which everyone at City First had for Ashby’s father.
Ashby was impassive. “What drivel,” he thought. “They would all have been celebrating.”
When Grant had finished his homily, Ashby reciprocated and said “If my father had still been alive, I’m sure we wouldn’t have been sitting here having to go through all of this about the Captain Stratos. It would have been resolved without the threat of a court hearing. But here we are and we have a trial next week.”
“We do, indeed,” said Grant. “Oh, by the way, our talk is completely off the record.”
Ashby merely nodded. He was there to get the measure of his opponent, not to pay anything – or at least anything much.
“Please go ahead,” said Ashby and invited Grant to put his version of events, why the claim was valid and Plantation should pay.
For fifteen minutes, Grant set out every reason he could think of, to justify payment by Plantation.
“The owners have been extremely patient. We know that this isn’t the best time to put this claim to you, just after the death of your father. We know that Plantation is going through a rough patch. However, the shipowners have their business to run. They don’t have a freighter any more. The crew and cargo were insured separately – and the insurers on those policies paid long ago. Why then, is Plantation being difficult ?”
Grant knew these points had emotive appeal. They’d been suggested by the lawyers the day before – and they might evoke some sympathy from a judge – if they got that far.
Ashby looked at the single malt whisky in his glass.
“Yes, I do understand their position. But for a moment, could you look at it from our perspective ? So far, there hasn’t been any evidence of what caused the ship to go down. At the moment, there is very little for us to go on – in fact, from what we can see, there’s almost nothing. We’d like to understand how the ship actually met with the accident which sank her and what became of her. To do that, we’d need further time to carry out our investigations. Under the policy, the owners must co-operate with us. To be honest, I haven’t seen any assistance from that direction. It would be different if they’d agree to delay the hearing for say, a further year.”
“A year ? Robert, please….don’t get me wrong but – I know them – they wouldn’t even agree to a week. They’ve already been waiting for almost three years – surely that was long enough to find the wreck. Please – be reasonable. I’m under pressure from Athens myself to get this sorted because they’re under pressure.”
“Hmm. So we can’t agree anything about further time to find the wreck and discover why it went down ? That makes it difficult for us.”
“Tomorrow the owners will be asked to pay one hundred thousand pounds to their solicitors for the hearing. If they have to do that, then all bets are off, they’ll take it to court and let the judge decide – and I can tell you without giving anything away, their counsel have said Plantation has no defence – none at all – so it would be over fairly quickly.”
“I would expect them to say that. But you know the insurance game, the same as I do and you know how we’re always alert to fraud….”
“Fraud ? Why….what are you suggesting ?”
“I’m not suggesting anything except that if this was a straightforward case where there was a collision, for example, with another ship in the middle of a storm and there were search and rescue helicopters attending the scene or the coastguard were there picking up survivors in lifeboats and everyone saw one of the ships going down over half an hour and there was wreckage and cargo strewn on beaches….it would be a different story, wouldn’t it ? And we would have paid up at the start. But with the Captain Stratos – there’s nothing. Absolutely nothing. And naturally, we’re wondering what happened to everything on the ship ? Nothing and no-one was washed up on the coast in the entire three years. Not a trace.”
Grant realised that it was time to rein in Ashby’s self-assuredness. The reference to fraud was a red herring. The way to ignore it was to get onto the numbers.
“Well, I won’t go over it all again – you know what happened as well as I do. There was no collision with another ship and so on. There’s no parallel with the example you’ve given and what happened to the Stratos. Now, what I want to know at this eleventh hour is whether Plantation will settle this claim or not ?”
“It should have been evident by now that we won’t pay anything until we’re completely satisfied how the ship met with an accident and that all of its cargo was completely destroyed and that all of its crew perished when the ship went down. That is our position.”
“In other words, you won’t pay anything.”
“Not until our investigations are complete and we know what happened.”
“Not even if the owners offered a discount on the claim ?”
“Hmm. Well, how much of a discount ?”
“Say, five per cent – payment within fourteen days.”
“That’s far beyond the realms of possibility.”
“Well, what did you have in mind ?”
“Uh, nothing really….although we might consider a nuisance payment.”
“Such as ?”
“Well, let’s see....what about the owners’ legal costs up to today.”
“But that would be less than…. one hundred thousand pounds.”
“It would ease their financial burden.”
“And you’d offer nothing else ? What if our discount was increased to ten per cent for a quick payment ? Would that change your mind ?”
“It wouldn’t matter if yo
u offered a ninety per cent discount.”
“Ninety ! Ha ha, that would leave almost nothing.”
“The furthest we’d go, would be a nuisance payment of.....let’s see….say, the shipowners’ legal costs and court expenses.”
“Listen….we’re not going to get anywhere at this rate,” said Grant. “I wanted to avoid saying this but….you do know what will happen once this goes to court and the judge awards us the full value of the claim and all the interest and the legal costs. If Plantation doesn’t pay all of that quick smart, we would then bring in the liquidators.”
“That is a risk we will have to take.”
“Robert, believe me, the clients don’t want to have to go through any of that, they’ve suffered enough already but if they’re left with no choice, they’ll do it – I can say that without hesitation. And if Plantation stopped taking new business, everyone else would pile in to get their claims paid, wouldn’t they ?”
“I hadn’t actually thought about it before but now you’ve mentioned it, running off all of Plantation’s future claims in liquidation wouldn’t be the end of the world, if it came to it. Plantation was my father’s company, not mine – and he’s no longer around. You know as well as I do that even if we stopped taking on any new business from this moment onwards, the contracts on our books could take up to forty years to dwindle down to nothing – that’s the way insurance works. The liquidators would declare a dividend – so many pence in the pound – every two or three or five years. And what would the owners of the Captain Stratos get at the end of the day along with the others ? Almost nothing. They wouldn’t even get back the full amount they’d paid their lawyers. Surely they know this already ? I can see from your look of surprise that they don’t. So, you see, the prospect of liquidation is really a hollow threat. And – here’s the killer, not just for them but for you at City First – it wouldn’t just affect the Greeks and their claim – it would cut away a large chunk of any future claims which all your other clients would have on policies with us. Have you considered that ? I’m sure they’d thank you if they knew that City First were the ones who shut Plantation down. Consequently, it’s your clients – all of your clients, not just the Greeks along with City First itself – who have more to lose than what we do.”
“If Plantation survives, this may very well break our ongoing business relationship – we’d stop sending you any future business.”
“I expected you to say that at some stage. That doesn’t worry me. My father knew all of your directors in your head office in New York – I even know some of them myself. If I have to, I’ll explain our position to them in person. And anyway, there are plenty of other fish in the sea – City First aren’t the only brokers in the world.”
Grant made no reply but the redness of his face revealed his anger : with himself, for not considering this in advance of seeing Ashby ; with Frances Keen’s firm, Ridgeford Anthony for not considering such an important point ; and with David Wellbourne for needlessly raising the expectations of the Greeks that Plantation would pay.
“Very well. I can see that we can’t progress things any further. So, Robert, thank you for your time. I’ll pass on to our clients what we’ve discussed this afternoon and I expect we’ll see each other in court next week. Just on that subject, we’ve heard that Thomas are no longer representing you. Do you have anyone else lined up ?”
Ashby remained impassive. “We’re working on it.”