Bermuda insurance giant ACE Ltd. is believed to have paid out $6 million to a key member of staff who left the company after a fight with the company's chief executive officer, The Royal Gazette has learned.

John Charman, who was listed the single largest executive stakeholder in ACE Ltd. this year with $115 million worth of shares, quit after a row with the company's chief executive officer and chairman, Brian Duperreault, in March.

In the company's second quarter report, the company states it paid "certain non-recurring expenses amounting to $4.5 million, net of related income taxes".However, no-one at ACE will comment on the pay-out, citing a confidentiality clause in the deal.

The Royal Gazette understands only $4.5 million of the $6 million showed up on records because much of the rest of the payment was tax deductible.

As a key member of staff in ACE's Lloyd's operation in London, his salary last year was $616,250, according to figures registered with the Securities and Exchange Commission. His bonus was $1.9 million and for the year ended December 31, 2000, his total compensation package was worth $3.652 million.

At the time of his resignation, Mr. Duperreault said: "This development occurred as a result of differences between us over personal matters."

The row followed the announcement of a global reshuffle at ACE in February, when the company was broadly split into two, placing Mr. Duperreault and Dominic Frederico squarely at the head of each sector.

ACE Ltd. would not comment on the payout - nor confirm or deny that the payment was made to Mr. Charman - as the payment listed in their report was subject to a confidentiality clause.

One insider said: "Nobody knows for sure what happened, but it was just after the restructuring that Charman and Duperreault had a fight. He left and the word is that they had to pay him a huge settlement which was in the millions."

Another said: "The payment was made in respect of the Lloyd's operations, that much is common knowledge. And it would not take a genius to work out that it was Charman who got the $6 million pay-off."

Mr. Charman joined ACE as chief executive officer of ACE Global Markets in 1998 following the acquisition of of Lloyd's agency Tarquin PLC by ACE Ltd. for $500 million. Mr. Charman was then managing director of Tarquin.

He then also became deputy chairman of ACE INA when ACE acquired US insurance giant CIGNA.