NETHERLANDS – The Dutch Pension and Insurance Chamber (PVK) has been found jointly liable for damages likely to be more than €80m over the collapse of life assurer Vie d’Or in the mid-1990s.

Pension funds and life companies are expected to bear the costs for up to €13m before the state guarantee to the PVK pays any additional damages. The Hague Court of Appeal found on behalf of the 11,000 Dutch policyholder in Vie d’Or, who were represented by Allen & Overy, against the PVK, Deloitte (the company’s auditors) and Heijnis & Koelman (now owned by Hewitt and who were the actuaries).

It is unprecedented for the PVK to have been found liable for damages. The only route for appeal is to go to the Supreme court, although this can only decide on whether the law was applied properly and it is uncertain if any of the parties will appeal. Deloitte said it was studying the verdict to see if an appeal was possible. A spokeswoman for Deloitte said: "At first sight there are important questions that need clear answers." She added it was too speculative to decide how any damages would be split between the parties.

Arnold Croiset van Uchelen, the Vie d’Or litigation partner at Allen & Overy, said: "This judgement is a maximum outcome for the former policyholders and other creditors of Vie d’Or. The court said the insurance chamber PVK was liable in view of the problems at Vie d’Or it should have been aware of at least from 1991 and which called for the appointment of a silent administrator.”

Vie d’Or grew rapidly from 1985 to the early 1990s but went out of business in 1993 and then into technical bankruptcy in 1995. KPMG, which was hired by the policyholders’ foundation, has estimated the damages at €80m. Croiset van Uchelen said Vie d’Or’s collapse had been due to “uncontrolled growth, fraud and the balance sheet being beefed up with assets that did not last in an emergency. The money was not adequately managed and risks not covered.”

The PVK and Heijnis & Koelman declined to comment at short notice.

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