The current system for compensating mesothelioma victims is inherently unfair, with the outcome subject to a number of vagaries, including whether the victim was exposed to asbestos during the course of their employment or whether their exposure was from the contaminated clothing of a relative says Thompsons' national head of asbestos litigation Ian McFall
The Department of Work and Pensions recently consulted with unions, law firms and others on how the system of handling mesolthelioma claims could be improved. Thompsons’ national head of asbestos litigation Ian McFall examines the system and what needs to be done.
How mesothelioma sufferers get compensation
A mesothelioma sufferer can get compensation in one or more of the following ways:
- DWP benefits [including Industrial Injuries Disablement Benefit (IIDB), Disability Living Allowance (DLA) for Care (DLAC) and/or Mobility (DLAM) and Constant Attendance Allowance (CAA)]
- Payments under the Pneumoconiosis Workers Compensation Act 1979 (PWCA)
- A civil claim for damages against one or more of the companies responsible for exposing them to asbestos negligently and/or in breach of a statutory duty.
But not all victims get compensation and some may end up with none at all.
To be eligible for DWP benefits or a payment under the PWCA the asbestos exposure has to have occurred during the course of the applicant’s employment.
Anyone who contracts mesothelioma from para-occupational exposure – such as the wives, children or even grandchildren from a worker’s overalls – is automatically excluded.
The outcome of a civil claim for damages is just as unpredictable. It will depend on whether the company responsible for the asbestos exposure still exists, whether it has assets to meet the claim or whether the insurers on risk at the time of exposure can be traced.
Thompsons estimate that between 10 and 20 per cent of mesothelioma claims fail because the company no longer exists and insurers cannot be traced.
The court system
The mesothelioma fast track procedure in the Royal Courts of Justice (RCJ) delivers an effective system which results in an almost immediate judgment in the claimant’s favour where it is clear the defendant was in breach of duty. The claimant also receives interim payments of over £40,000 within weeks of starting proceedings and what is called a disposal hearing in a few months, which resolves any outstanding issues about assessing damages.
The vast majority of mesothelioma cases pursued in the RCJ fast track procedure settle without the need for a disposal hearing. With an average case lasting just a few months, most mesothelioma cases can be brought to a conclusion within a claimant’s lifetime.
Not surprisingly, there are increasing demands on the RCJ mesothelioma fast track procedure. The system is becoming overloaded and needs more resources to enable more cases to be dealt with more quickly. Claimants would also benefit from having the system rolled out to regional courts.
A fund of last resort
Since the introduction in 1972 of the Employers Liability (Compulsory Insurance) Act 1969 employers have had to hold liability insurance in respect of employees’ bodily injury and disease. Yet insurers in many mesothelioma claims often cannot be traced.
This is in no small part due to the insurance industry failing to keep adequate records.
An “insurance fund of last resort” would provide for payment of compensation in cases where the employer is insolvent and the insurer cannot be traced. Payments should be funded by a compulsory levy on the insurance industry.
Make insurers refund PWCA payments
Payments made under the PWCA to claimants who subsequently succeed in recovering damages are deducted from the total compensation due from the defendant company or their insurers. These are not refunded to the state, and are effectively a windfall for the wrongdoer or their insurer.
The compensator – the insurer – should be responsible for refunding PWCA payments to the State in the same way that it currently has to refund relevant DWP benefits to the Compensation Recovery Unit (CRU).
This would stop insurers receiving a windfall collateral benefit and would be an income stream to the state equivalent to the CRU recoveries.
Increase PWCA payments
Payments under the PWCA to claimants who submit an application during their lifetime currently range from £10,180 (for a person aged 77 and over) to a payment of £65,531 (for someone aged 37 and under).
These should be re-calibrated so that the minimum and maximum payments coincide with the bracket for an award of general damages for pain, suffering and loss of amenity in mesothelioma claims as currently set out in the Judicial Studies Board Guidelines. These would work out at £47,850 to £74,300.
Improve eligibility for IIDB
The Industrial Injuries Disablement Benefit (presently limited to people who have contracted the disease as a result of asbestos exposure arising out of or during the course of earned employment), should be relaxed to include para-occupational exposure such as clothing and environmental exposure claims, which could include living near an asbestos factory.
In many cases of para-occupational exposure there is no prospect of pursuing a successful civil claim for damages either because the responsible company no longer exists and there is no available insurance, or the court may not be prepared to find a breach of duty as in the recent Court of Appeal decision in Maguire -v- Harland and Wolff .
There are probably no more than 100 para-occupational exposure mesothelioma cases each year. The cost of providing DWP benefits and a PWCA payment to those claimants who would otherwise have no entitlement to any compensation would be relatively modest.
And it would remedy an injustice that Thompsons finds very hard to explain in any logical way to the wives, children and even grandchildren who have developed mesothelioma because they were exposed to asbestos through no fault of their own.
Damages in Scotland
There is a big difference between the way in which damages for bereavement are assessed in Scotland, as compared to England and Wales. There is no logical explanation for it.
In England and Wales a bereavement award is fixed at £10,000 for deaths occurring on or after 1 April 2002. In mesothelioma cases it is normally payable only to the spouse of the deceased.
In Scotland the equivalent award to a bereaved spouse is currently in the order of £28,000. Other family members such as siblings and children each have their own right to a payment of approximately £10,000.
That means that the compensation for bereavement for a family who can bring a claim in Scotland will differ by tens of thousands of pounds compared to a family in England and Wales.
The Rights of Relatives to Damages (Mesothelioma) (Scotland) Bill will ensure that relatives’ claims for damages are not extinguished by a person with mesothelioma settling their own claim whilst still alive. A similar statutory amendment should be introduced in England and Wales.
Alternatively the Civil Procedure Rules should be amended to allow a claimant with mesothelioma to make an application for an interim payment by way of Part 8 proceedings if they choose not to bring the claim to a full and final settlement during their lifetime, therefore preserving the rights of others to pursue a claim of greater value after their death.