Further Delay and Uncertainty for Asbestos Victims and Their Families

Dated:

On 8th October 2010 the Court of Appeal handed down judgement on what has become known as the Employers Liability Trigger Cases. The central issue at stake is what triggers an Insurer’s liability to pay out compensation under the terms of the policy: is it the actual negligent or wrongful act of the employer, or is it the beginning of the disease caused by the employer’s negligent or wrongful action?

The distinction is crucial in cases of asbestos exposure because typically exposure to asbestos has taken place long before the disease can be detected. In some cases the delay can be 50 or 60 years and in that time the employer may well have ceased trading. Historically victims who could prove fault were always able to recover compensation from the employer’s liability insurer of a defunct employer – that is to say the insurer who was on risk when the exposure to asbestos took place.

However, with millions of pounds of their potential profits at stake, a group of insurers challenged the application of this general principle in the case of a number of policies where the wording provided that the liability to pay would only be triggered when the harm occurred. The cases have become know as the Employers Liability "trigger" Claims and were initially decided in 2006 in favour of the victims. However the Insurer Companies immediately appealed and ever since that time, on disputed policies, the Insurers have refused to pay. Many victims have died not knowing whether their loved ones will succeed in obtaining compensation.

The matter came before the Court of Appeal last November, with the decision being handed down on 8th October, nearly a year later. The majority of the Court of Appeal Judges ruled in favour of victims, on the basis that the parties to the insurance contact when it was made intended that the premium should be paid by the employer in return for which any harm emanating from the employer’s wrongful actions during the period of insurance should be covered by the policy. It was said that this was the parties intended commercial purpose of the policy.

Whilst victims and their lawyers waited the outcome of the Appeal with keen interest, ultimately each side predicted that whatever the outcome it would be appealed to the Supreme Court, and that is exactly what has happened. Pending the outcome of the further appeal, it is expected that Insurers will continue to fail to pay out claims.

Emma Costin, Head of Industrial Disease at Simpson Millar LLP Solicitors, says:

"The human aspect of what has happened and is still ongoing is impossible to ignore, victims and their families now face years of further waiting and uncertainty. The process of bringing a claim for a mesothelioma victim is often a complex one, he or she will come to realist that what is at stake is not only money to provide for the security of their loved ones, but also and very importantly it is a calling to account for a wrong which is among the worst that an individual can suffer – that which has the result of shortening their life, of causing a painful death which their loved ones must bear witness to. It is a disgrace that this issue has taken so long to resolve, and a very powerful argument for the swift introduction of a state funded Employers Liability tracing bureau and fund of last resort."

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