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Veteran City fund manager Patrick Evershed was forced out of New Star Asset Management after accusing founder John Duffield of bullying, court papers alleged today.
Evershed, who is suing New Star for unfair dismissal, this week won the right to seek unlimited compensation under whistleblowing laws, having left the firm last year after clashing with Duffield.
His case against New Star and Duffield was outlined today in employment tribunal papers seen by the Evening Standard.
The papers allege a culture of intimidation at New Star, which had to be rescued by Henderson after falling into disarray. The case is being seen as a battle between the old City and the brasher money-making world of Mayfair, where Duffield was based.
Evershed is a Tory grandee with 40 years of experience in the City, while Duffield is regarded as a tougher, more forceful character openly proud of his wealth. He claims to have created more millionaires than any other UK entrepreneur from his success founding and running Jupiter Asset Management.
Duffield got £175 million for selling his stake in Jupiter. He then set up New Star, which was initially successful.
The papers reveal that Evershed sent an email to the New Star human resources department on 18 September last year to complain about bullying by Duffield and his joint chief investment officer Gregor Logan. "Later that day he was told to go home and not return until further notice," the papers said.
Evershed claimed the "suspension" was "wholly unreasonable", according to the document, and was "carried out in a particularly humiliating manner, with allegations being made about his mental health".
He was accused of having a mental breakdown and resigned from New Star on 23 September 2008.
Evershed is claiming unfair dismissal and victory could lead to a payout of nearly £1 million, the equivalent of five years' salary. New Star has denied allegations of bullying.
Evershed alleged Duffield's actions put him in "an intolerable position, leaving him with no choice but to leave", according to the court document. He claimed he was put under intense pressure "to increase the size of the fund which he managed, against his better judgment".
He also alleged that "as a result of Duffield's manner towards his fund managers the performance of their funds had dramatically declined".
This damaged the reputation of Evershed and other fund managers at New Star, it was claimed.
The document went on: "Duffield is said to have behaved in an offensive and intimidatory manner towards the claimant [Evershed] when the claimant intervened to prevent the bullying of a colleague." It added that Evershed complained on a number of occasions to the New Star board about Duffield's conduct but his complaints were ignored.
Evershed said the case was "almost the story of how New Star collapsed".
It was rescued by Henderson Group in April following a slump in its share price and the value of its funds. Duffield set up New Star in 2000 having sold Jupiter Asset Management to German bank Commerzbank. Evershed joined shortly after and was for a long time considered one of his closest confidants and star performers. The relationship soured in recent years and Evershed left following a dismal run in his Select Opportunities Fund.
Duffield has since set up Brompton Asset Management. Its website is under construction and Duffield did not return calls today.
