The appellant, a diamond cutting and polishing company, appointed the first respondent, a specialist insurance broker, to procure insurance cover for its diamond business. The insurance policy contained a promissory warranty requiring the insured to keep detailed records of all transactions. After diamonds were stolen, the underwriters rejected the appellant’s claim on the basis that it had breached this warranty by failing to keep full records. The appellant then sued the broker, alleging breach of contract and negligence for failing to draw attention to and explain the implications of the warranty, particularly in light of the diamond trade’s practice of ‘off-the-book’ transactions. The broker denied any breach and contended that the claim had prescribed.