Businessmen and solicitors will be deterred from becoming non-executive directors and the job could radically change, after Equitable Life won the right to sue nine former non-executives in the High Court last week, City lawyers told the Gazette.

Mr Justice Langley was urged by counsel for the non-executives to strike out the claim for 3.3 billion - for failure to protect policyholders from the financial crisis that hit Equitable Life in the late 1990s - but instead he decided that they have a case to answer.

David Greene, a litigation partner at Edwin Coe, said that despite their limited control of the day-to-day management of companies, 'the finding says that non-executives can be liable for the wrongdoing of executives.

This means that no one - including solicitors - will want to be a non-executive director because of the potential liability'.

Mark Blyth, a litigation partner at Linklaters, said the case would be important in deciding how far a company is entitled to expect independence of judgement and supervision of the management from non-executives.

Mr Blyth said it would not only affect those considering becoming non-executives, but also those who already are non-executives.

He added: 'Non-executives will be considering whether their remuneration and insurance cover is commensurate with this type of risk.'

But he said: 'One result of this case will be to clarify for companies the role of the non-executives.'

Ian Terry, a dispute resolution partner at Freshfields Bruckhaus Deringer, said he was not surprised that the non-executives had lost the strike-out action, but he predicted that the Equitable would not defeat them in the main action.

Mr Terry said the case is likely to encourage non-executives to take on a more regulatory role within companies 'and that's not necessarily a bad thing'.

He added: 'If people are put off being non-executives because the duties are too onerous, then that would tend to reinforce the notion that someone should be there in these companies doing that job.'

Jeremy Fleming