of OffshoreOn.com. Reproduced with permission.

*** A Bermuda Supreme Court judge is considering whether a suit alleging breach of fiduciary duty and breach of contract against the Bank of Bermuda should proceed to open court.

Bermudian Dilton Robinson, who filed the civil suit against the bank in 1998, has applied to the court to add fraud allegations to the writ. The bank has applied to strike out the writ, preventing it from proceeding further. If the suit does go ahead, then it would be one of two that could hurt the bank's attempt to list on the Nasdaq stock exchange.

Preliminary closed-door hearings on the bank and Robinson's filings were heard 24 and 25 January 2001 before Bermuda Supreme Court Justice Vincent Meerabux, who is expected to issue a decision soon on whether the case should proceed with the addition of fraud to the allegations.

The Bank of Bermuda declined to comment on the court action. "Since this matter involves civil proceedings that are currently pending, it would be inappropriate for us to comment,'' the bank told OffshoreOn.com in a written statement. "In any event, the bank has a policy of not commenting publicly on matters concerning our clients.'' Robinson has also filed another suit making similar allegations against the bank, Henry Smith, who is the bank's president and chief executive officer, and David Gutteridge, who is a current director of the bank and the former vice president of Bermuda Home.

Bank fights suit Robinson's wife, Sharon, has filed a writ making the same allegations against the bank in a separate but related case. Preliminary matters in both of the Robinsons' cases were heard separately in chambers during 2000.

The issue concerns a $1.3 million loan Robinson took with the bank in the early 1990s. Soon afterwards he lost his job as assistant manager of mortgage at L.P. Gutteridge Mortgage & Finance and defaulted on the loan.

The deposit company was merged into Bermuda Home and purchased by the Bank of Bermuda in 2000.

Robinson was also the principal behind Summit Development, a company involved in the Bermuda real estate market, while he was assistant manager at L.P.

Gutteridge.

Robinson is being represented by a legal team led by UK lawyer John Roberts QC of 12 Old Square Lincoln's Inn and by Claire Hatcher of Francis & Forrest in Bermuda.

His wife is represented by Bermuda firm Milligan-Whyte & Smith. The bank is being represented by Appleby Spurling & Kempe.

The matter is going on at a time when the Bank of Bermuda is in the process of preparing to file documents with the US Securities and Exchange Commission as part of its application to list on the Nasdaq stock exchange.

"Our goal remains to list at the earliest opportunity,'' the bank stated.

"We have no specific timetable.'' Bermuda's finance minister announced 8 December 2000 the bank had been granted an exemption from Bermuda's Companies Act regulations limiting foreign ownership in local companies to a maximum of 40 percent (BizOffshore January 2001).

The bank also faces a class action lawsuit in the US filed by investors against its Cayman Islands' branch claiming management aided an alleged pyramid scheme called Cash 4 Titles to bilk them of more than US$300 million.

The lawsuit was filed in a US District Court in Miami in October 2000 and seeks triple damages.

"The claim filed against the Bank of Bermuda (Cayman) is full of factual inaccuracies and the bank denies in the strongest possible terms any wrongdoing,'' a spokesman said. (LawOffshore November 2000).