On 3 May 2006, barely 10 weeks ago, the Judicial Committee of the House of Lords (the most senior Court in the UK) ruled (in Barker v Corus) that a mesothelioma Claimant was not entitled to recover full compensation from any single employer that exposed him to asbestos, as had been the law since the case of Fairchild in 2002. Instead they ruled that mesothelioma Claimants could only recover a proportion of damages from each employer. Many employers who exposed their workers in the past have since gone out of business. Because their insurers cannot be traced, the Judgment had the effect of reducing the compensation payable to mesothelioma victims and their families. It also had the effect of prolonging cases whilst extensive searches were made for the insurers of long-dissolved companies. As a result of the ensuing outcry from MPs, victim support groups and others, the Government moved swiftly to try to reverse that decision, by tabling amendments to the Compensation Bill that was already passing through Parliament.
On Monday 17 July the House of Commons approved amendments to the bill which would:
- give back to mesothelioma Claimants their right to obtain full compensation from any single negligent employer
- entitle employers and insurers to seek contributions from other employers and insurers when available
- enable employers and insurers to obtain contributions from the FSCS (Financial Services Compensation Scheme) in cases involving dissolved employers who have no effective insurance.
The Minister, the Rt Hon Bridget Prentice MP, said the amendment would also stop insurers arguing that they were only responsible for a proportion of the liability of the insured employer.
Now that the House of Lords has passed the amendment the Act may become law before the end of July and will affect all mesothelioma claims that are settled or come to trial after that date. However, the amendment contains an additional, novel, proposal that all mesothelioma claims that have been settled or tried since the Barker decision could be re-opened.
Andrew Morgan, Partner in the Asbestos Claims Department of Field Fisher Waterhouse LLP, says:
"This is an extraordinary reversal of fortune for victims and families bringing mesothelioma claims. Barely 10 weeks ago we were faced with the prospect of having to tell our clients that suddenly, as a result of the Barker Judgment, they would only recover a fraction, in some cases a small fraction, of the compensation to which they were entitled. They were faced with the task of having to pursue individual insurers much more vigorously or else lose compensation.
In most mesothelioma claims timely payment of compensation reassures the victim that his family will be provided for when he is gone or gives his widow and dependent children a measure of financial security after his death. Anything that threatens the speed of obtaining compensation or the amount of compensation that is payable in mesothelioma claims is very serious indeed.
The Government has also taken the opportunity to allow for reform of the FSCS. Up to now the inclusion of the FSCS as the fund representing insolvent insurers has led to sometimes very substantial delay in the settlement of mesothelioma claims because the "lead" insurers have been prevented from settling the claim early. The amendment to the bill will allow the lead insurer to settle the claim early and in full to get a contribution from the FSCS. That should greatly speed up the settlement of affected mesothelioma claims.
The fact that the Act will be retrospective, as far back as 3 May of this year, is something that was much sought after by victim support groups - it will complete the picture for mesothelioma claims for the present".
Fieldfisher is one of the country’s leading asbestos disease claims firms. Over twenty-five years Rodney Nelson-Jones and his team have recovered more than £100M in over 1,750 successful cases.
For more details or comment please contact Andrew Morgan (0330 460 6737) or Peter Williams (0330 460 6805), partners in the Asbestos Claims Department of Field Fisher Waterhouse LLP.