Contents
Mesothelioma - Apportionment issues remain unresolved
Secondary exposure asbestos claim
Pleural plaques litigation
Funding the voids, minding the gaps: The ABI mesothelioma claims handling agreement
Vibration white finger: Constructive knowledge
Deafness and 'notching'......
Fybromyalgia - the new RSI epidemic?
Jurisdiction - Work-related stress
Work-related stress
The advent of passive smoking litigation
Mesothelioma - Apportionment issues remain unresolved
The long-awaited judgment of the Court of Appeal in Barker v St Gobain Pipelines plc [2004] EWCA Civ 545; (2004) 148 S.J.L.B. 570 was handed down on 5 May.
The claimant, Sylvia Barker, is the widow of Vernon Barker who died in June 1996 at the age of 57 of mesothelioma resulting from exposure to asbestos dust.
Between 1960 and 1968 Mr Baker had been intermittently exposed to asbestos at Shotton Steel Works in Deeside. He had also been intensively exposed over a six week period whilst employed by Graessers Limited in 1958. (For technical reasons, the proceedings against Graessers were abandoned).
Unusually, the deceased suffered further exposure working as a self-employed plasterer between 1968 and 1975.
At first instance, the defendant argued that the principle enunciated in Fairchild should not be extended to this case as it could not be proved that the deceased was a victim and that a breach of duty by someone else had caused his mesothelioma. However, the court was not persuaded that justice would be served by denying the claimant any damages simply owing to the period of self-exposure.
Judge Moses J recognised that apportionment had been left open in Fairchild. The defendant argued that if (as in Fairchild) the orthodox test of causation for mesothelioma is relaxed to the detriment of employers generally, justice demanded an apportionment exercise, in terms of contribution to the risk, notwithstanding the medically indivisible nature of the disease. The judge declined to adopt this imaginative solution, taking the view that this would be contrary to authority. Contributory negligence was assessed at 20% on the basis of Mr Barker's exposure whilst self-employed.
The defendants raised two main arguments in support of the appeal:
1 The case fundamentally differed from Fairchild, since to fall within the Fairchild rule of causation, the claimant had to establish that he was a victim. The judge at first instance failed to deal head-on with the situation in which the culpable employed exposure was minimal compared with long periods of self-employment.
2 The judge erred in considering himself bound by authority. The application of the Fairchild principle to different situations would become more straightforward - and indeed just and certain - if an apportionment-based approach was adopted. It would be unjust not to apportion the damages in this case. The court should look at the position imaginatively by adopting the principle of 'distributive justice' commended by Lord Justice Steyn in McFarlane v Tayside Health Authority (HL) [2000] 2 A.C. 59; [1999] 3 W.L.R. 1301; [1999] 4 All E.R. 961, namely that a solution regarded as socially and morally acceptable by the average person should be preferred to one based on precise legal formulations.
For the claimant the counter-arguments were:
- That the modified approach to causation in Fairchild was supported not only by principle and authority, but also policy considerations. The injustice of denying redress to a victim would arise if the defendants could avoid liability owing to a certain period of self-exposure.
- Whilst in a divisible injury, the defendant is only liable to the extent to which his breach of duty contributes to the injury (Holtby v Brigham & Cowan) [2000] 3 All E.R. 421; [2000] I.C.R. 1086; [2000] P.I.Q.R. Q293) the position in relation to an indivisible injury is critically different. Indeed, the defendant in Fairchild conceded that as mesothelioma was an indivisible injury, the Fairchild claim was an 'all or nothing case', and not appropriate for apportionment. This creates an injustice for the defendants in particular cases which could be improved by bringing proceedings under the Civil Liability (Contribution) Act 1978 against other potential wrongdoing, or by (as here) applying a reduction for contributory negligence in view of self-exposure.
The Court of Appeal dismissed both of the defendants' arguments and wholly endorsed the first instance decision of Moses J.
Accepting that Fairchild led to potentially unfair scenarios on both sides, in the leading judgment Kay LJ said:
It seems to me inevitable that whatever solution the law finds, it will always be possible to suggest an extreme situation in which the answer may not seem to be entirely fair to one or other party. The policy decision has to be made on the basis of the generality looking for the fairest solution when the matter is considered in the round.
The approach of Moses J was the one most likely to achieve the proper objective of the law, and as there is fault on the part of the claimant, this could be reflected by a finding of contributory negligence. Similarly, there was insufficient justification in law or policy to alter the normal rule against apportionment.
The validity of the employers' arguments appears to have been recognised, but the court simply preferred the claimant's arguments. Indeed Keene LJ conceded that he:
Was for a time attracted by the defendants' argument that if one is dealing with an exceptional or novel situation, as is the position in these mesothelioma cases in the current state of medical knowledge, then one should be prepared to develop the law in a new direction to achieve a just result.
On reflection, he took the view that there was no need to depart from the long-established principles applicable in the case of an indivisible injury.
Two similar cases involving British Shipbuilders were dealt with in the same way.
Arguing that mesothelioma should be apportioned like a divisble disease is the employers' last resort to derive some relief from the intractable post-Fairchild problems. This is an important issue for the insurance industry in view of the escalating numbers of mesothelioma claims. The House of Lords needs to consider this issue, not having had the opportunity to do so in Fairchild. Leave has been given for appeal to the House of Lords.
Brian Goodwin,
BLM Liverpool
Secondary exposure asbestos claim
In Maguire v Harland & Wolff plc (QBD, 26 March 2004) LTL 6/4/2004 : Times, April 29, 2004 the claimant was the wife of a boilermaker who worked at the defendant's shipbuilding premises between 1961 and 1965. During this time he was heavily exposed to asbestos dust which contaminated his work clothes. The claimant handled his work clothes on a daily basis and removed the dust by shaking and brushing them down before washing them. As a result of this exposure she developed mesothelioma in 2000.
The claimant alleged that the defendant owed her a duty of care not to expose her to the risks associated with the inhalation of asbestos dust and that the defendant breached this duty. Whilst the defendant accepted that it was in breach of its duty of care in exposing the husband to asbestos dust, it denied any such duty of care to the claimant on the basis that, between 1961 to 1965, it was not foreseeable to the reasonably prudent employer that there was a risk of mesothelioma from this secondary and relatively light exposure. Knowledge of mesothelioma itself did not generally emerge until after 1965.
The court found that the defendant should have been aware from the 1930s that the inhalation of asbestos dust gave rise to a risk of serious pulmonary injury and towards the end of the 1940s it was also known that asbestos exposure could result in lung cancer. The defendant must have known that when the husband went home he would take asbestos back on his work clothes and the claimant would be exposed to this. Following the line of authorities of Margereson v J W Roberts Limited (Court of Appeal, [1996 PIQR19]and Jeromson and Dawson v Shell Tankers and Cherry Tree (Court of Appeal, [2001 PIQR19] it was found that the defendant ought to have foreseen the risk of some pulmonary disease from secondary exposure, even if it could not foresee a particular risk of mesothelioma. The dangers of asbestos were sufficiently well known and sufficiently uncertain in their extent and effect for employers to reduce the exposure to the greatest possible extent. The defendant failed to take any steps to prevent or reduce either the employee's or his wife's exposure. It was held that the risk of serious injury to the claimant's health from such secondary exposure was reasonably foreseeable and, in fact, obvious.
This decision contrasts with an earlier secondary exposure claim of Gunn v Wallsend Slipway & Engineering Co Limited (1988) Times, January 23, 1989. In that case the husband's wife was also exposed to asbestos dust that he brought home on his work clothes for washing between 1948 until 1965. However, it was found that the defendant did not owe the wife a duty of care as no one in the industrial world had considered the risk of mesothelioma from secondary exposure to asbestos dust before October 1965.
Maguire demonstrates the courts increasing tendency to retrospectively burden employers with a greater degree of knowledge regarding the dangers of asbestos than may have existed at the time.
Following this line, a defence that risk of injury was not foreseeable is increasingly difficult to maintain for occupational exposure to asbestos after the 1930s.
Helen Weston,
BLM London
Pleural plaques litigation
The value, incidence and legal standing of pleural plaques claims has become an increasingly topical issue for employer liability insurers over recent years. Test litigation has now been commenced to determine:
1 Whether pleural plaques are compensable.
2 The general damages tariff for this asymptomatic condition.
3 Whether compensation should be paid at the same time for the risk of other asbestos diseases and if so, how that should be assessed.
At present the test litigation comprises of 12 claims being managed by Master Whitaker at the Royal Courts of Justice, London. The trial is due to take place at the Manchester High Court on 8 November 2004. The only certainties are that the first instance judgment will be appealed and that BLM will keep you advised of the developments.
Background to the test litigation
An analysis of asbestos-related claims for one major Chester Street policyholder over a two year period revealed 75% of all asbestos claims and 51% by settlement value have been for pleural plaques. Mesothelioma, historically perceived as the 'most expensive' asbestos-related condition amounted to only 12% by number and 38% by value.
In the United States the 'asbestos litigation crisis' has been blamed for the bankruptcy of several asbestos manufacturers - with most of America's industrial, oil, chemical and utility companies now ensnared in asbestos litigation.
So whilst pleural plaques are the least serious of the asbestos conditions for claimants, they look set to be the most serious in terms of financial consequences for the insurance industry. Pleural plaques are seldom disabling, rather they are 'markers' that confirm previous exposure to asbestos. They indicate a higher risk of developing other asbestos-related disease. Their presence does not cause the development of malignancy or loss of lung function.
The House of Lords in Cartledge v Jopling [1963] AC 758 considered whether compensation should be awarded for an asymptomatic condition.
The case involved limitation arguments in a group of pneumoconiosis cases. The appeal turned on whether asymptomatic pneumoconiosis (of which the claimants had knowledge) constituted an injury from which a cause of action could flow.
In finding that the asymptomatic condition constituted 'injury' Lord Pearce stated:
It is a question of fact in each case whether a man has suffered material damage by any physical changes in his body. Evidence that those changes are not felt by him and may never be felt tells in favour of the damage coming within the principle of de minimis non curat lex. On the other hand, evidence that in unusual exertion or at the onslaught of disease he may suffer from his hidden impairment tells in favour of the damage being substantial.
Whether the condition of asymptomatic pleural plaques constituted 'substantial' damage, and so actionable inury, was considered at first instance in a series of well known cases in the 1980s. In Sykes v MOD, HC 19/3/1984 [TLR 23 March 1984], the judge accepted the structure of the pleura had been irrevocably altered by the scarring and had to decide on the basis of Lord Pearce's speech in Cartledge whether the:
Physiological damage which was done to the plaintiff … is to be treated as minimal or negligible or falling within the principle of de minimis.
He came to the conclusion that:
There has been definite change in the structure of the pleura due to the presence of asbestos. In my judgment, that amounts to a significant and definite degree of damage which entitles the plaintiff to compensation, as he has established actual damage.
In Morrison v CEGB (Nottingham CC 15/03/86 unreported) Simon Brown J found that symptom-free physiological change to the pleura did not alone constitute an 'actionable injury'. Damages were awarded to the claimant on the basis of the combination of symptomless pleural plaques, the risks of developing other asbestos-related disease and the associated anxiety caused by knowledge of those risks.
Damages tariff
Claimants are often awarded provisional damages which enables them to seek further damages in the event of a 'serious deterioration' of their condition.
Recent provisional damages awards for asymptomatic pleural plaques show a steep increase, far exceeding inflation. In Paterson v MOD 1986, a provisional award for asymptomatic pleural plaques was made of £1,250 and in Mustard v Sunderland Ship Builders Limited (1987, unreported) an award of £2,000 was made. These awards would today be £2,324 and £3,558 respectively.
However, recent awards have been in the region of £5,000 - £6,000: Heath v Cape Distribution Limited (Oct, 2002, Current Law) and Greenhow v Wilmac Limited (1998, Kemp F2-073/1). Where claims are settled on a full and final basis, the claimant is compensated for the risk of deterioration and any other asbestos related disease developing.
In so doing, insurers may of course be paying for risks that never materialise but have the benefit of claims closure. Conversely, the claimant would have been grossly under compensated were he to develop mesothelioma or lung cancer at a later stage. The latest Judicial Studies Board Guidelines provide the bracket of £15,000 - £20,000 for pleural plaques 'involving some but limited disability'. Such bracket is of no assistance when valuing an asymptomatic condition.
Where claimants apply contingent risk percentages to schedules of loss pleaded on the basis of a malignancy, pleural plaques claims can mount up to £60,000- £70,000. Such an 'arithmetic' approach to the assessment of future risks has little merit. The recent decision of Hooper v Prescot (No 1) Limited (Central London City Court 8/9/03, HHJ Reid) highlights that such awards vary considerably depending on the risks of future deterioration and the individual circumstances of a claim. Mr Hooper, aged 71, was awarded £5,765 on a full and final basis for asymptomatic pleural plaques. He was generally of poor health and his life expectancy short (due to non-asbestos related illness).
So there is plenty for the courts to consider. We can anticipate a judgment in the test litigation before the end of the year and considerable media interest as the litigation proceeds to appeal.
Nick Pargeter,
BLM London
Funding the voids, minding the gaps: The ABI mesothelioma claims handling agreement
Background
Fairchild left the insurance industry with a host of problems on several levels: the political fall out of attempting to avoid a liability to a fatally injured claimant or his widow was especially damaging at a time when there was (and remains) a real crisis in the EL market. The insurance market was asking for assistance at a regulatory level and the case was creating some of the worst 'press' in recent memory. The claimant lobby was incensed at the defence that was run to the House of Lords and was politically in the ascendancy. The issue of apportionment that is now being examined and adopted in a series of appellate judgments was not pursued (to the regret, expressed to the writer, of the some of the most senior judiciary of England and Wales).
The ABI mesothelioma guidelines needed to address a number of constituencies:
The political If the agenda of the Insurance Market was to return to centre stage.
The claimant lobby If the souring of relations between the claimant and defendant camps were to be improved.
The FSCS The substantial interests of the 'insolvent' market with its continuing long tail liabilities had to be included in any workable agreement.
The commercial sector It will continue to have a liability for long tail claims where there may be gaps in cover if that cover can be traced at all.
Overriding principles
That the claimant should receive prompt and full compensation for his injury from the co-ordinator - generally the insurer with the longest period of cover. Thereafter, the co-ordinator recovers proportionate contributions (based on time of culpable exposure but ignoring 'dose') from other employers and insurers.
Funding the void
Culpable employers must meet the damages that are attributable to a 'void' period (a period of culpable exposure where no solvent employer or insurer can be traced). When there are two employers, one of whom is able to meet the damages payable, but the other is insolvent without traceable insurance, the solvent employer will have to satisfy the judgment and fund the void period.
Minding the gap
A 'gap' is where the employer is self-insured, uninsured or unable to trace cover for part of the period of exposure (there being solvent insurance for the balance of the period). This 'gap' in cover is met by the employer or if the employer is insolvent by the other insurers on risk for that employer.
Parallel payment
Where an insurer is insolvent, contributions may be due from the employer (if solvent) the estate of the insolvent insurer or the FSCS. Parallel payment is the process by which these contributions are paid separately to the claimant or his representatives because the FSCS can only pay a claimant direct. A payment must never be made on behalf of the FSCS because it is unable to reimburse the contribution. As a simple rule of thumb payments by the 'solvent' market and the 'insolvent' market should be made separately.