Jolyon Patten explains why local authorities cannot act as insurers
In a landmark two-part judgment (Risk Management Partners Ltd v Brent London Borough Council and others [2008] All ER (D) 226 (May)) which will have far-reaching implications for the insurance industry and for local authorities, the High Court has found that Brent LBC had no power to participate in London Authorities Mutual Limited (LAML), a mutual insurer for London borough councils. It also found, in principle, that no local authority can participate in such a mutual if it does so to save money on its insurance. In additional (obiter) comments, the judge held that there might be circumstances in which a local authority could do so, but that there was no evidence that LAML could bring itself within those circumstances.
A second judgment in the same case addresses for the first time in the UK the so-called Teckal exemption to EU rules on public procurement. Here, it was found that Brent did not have the necessary control over
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