A confidential out of court settlement has ended a lengthy legal dispute between six former owners of the SRS underwriting agency and major broker Gallagher.

The SRS partners mounted the action in 2017 in the Queensland Supreme Court, claiming $3.6 million plus interest from Gallagher in a dispute over a final payment.

SRS was Australia’s largest Lloyd’s underwriting agency when it was acquired by Gallagher in November 2012. The sale agreement included a final “earnout” payment to be calculated on the amount of commissions earned over a three-year period ending in December 2015.

Documents filed by the six SRS partners in the Queensland Supreme Court alleged the calculation used by Gallagher in late 2015 was applied in a way that had not been agreed, and resulted in a zero earnout.

SRS – later rebranded as part of Gallagher’s Pen Underwriting operation – lost much of its established business with international brokers when Gallagher bought the national OAMPS brokerage for $1.01 billion 17 months after buying SRS.