Opening old wounds

In April, the House of Lords will weigh up the rights of asbestos sufferers to claim compensation.

Michael Gerrard says this debate will reverberate throughout the PI world

Personal injury lawyers and their insurance industry counterparts go into battle in April, in a case which has rocked the sector to its core.The House of Lords is scheduled to deliberate on three cases: Fairchild v Glenhaven Funeral Services and others (The Times) 13 December 2001, Doreen Fox v Spousal, and Edwin Matthews v The Associated Portland Cement Manufacturers (1978) and British Uralite.These cases have been at the centre of a storm that has threatened to overturn more than 25 years of recognised court practice.

Before the initial Fairchild decision in February 2001, in cases related to cancer caused by asbestos, the odds were overwhelmingly stacked in favour of personal injury claimants and their lawyers.This and the other two similar cases heard last year went to the Court of Appeal in December, and the verdict has given defendant companies the upper hand for the first time in a generation.Before this decision, companies would either settle or be ordered to pay out compensation to claimants on the basis of their material contribution to causing that illness.In cases where more than one defendant was liable, each would be liable for compensation on a percentage basis, based on the time the claimant was exposed to asbestos during employment at each firm.But Fairchild revealed a new factor, which has so far thrown a spanner in the works: mesothelioma, the type of cancer common to all three cases, was judged to have been triggered by a single asbestos fibre; not the result of cumulative damage.Using this fact, defence lawyers argued that with more than one defendant, causation would be impossible to prove; that is, at which company the offending single fibre was inhaled.In December, the Court of Appeal backed this view.

It stated: 'This leap over the evidential gap not only defies logic but is capable of unjust results...

If we were to accede to the claimants' arguments, we would be distorting the law to accommodate the exigencies of a very hard case.'Geraldine Coombs, a solicitor at Manchester firm John Pickering & Partners, represents the claimant in the Matthews case.

She emphasises the scale of the decision: 'We think the Court of Appeal got it wrong.

For the last 25 years and more, mesothelioma victims have been routinely compensated and we are looking for the House of Lords to get it right.'When Matthews was initially heard in the High Court last July, the judges found in favour of the claimant and awarded compensation of 155,000, even though Fairchild had been heard several months before.But victory was shortlived - the defendants appealed and the case was bracketed together with Fairchild and Fox, another case in which judgment was made in favour of the defendant.These cases have set the stage for a scrap between two sets of lawyers, never known for their cordial relations.

To understand fully how upset those representing asbestos sufferers are by the latest turn of events, it is necessary to appreciate that Fairchild is the latest of several setbacks during the past year.Last February, Chester Street Insurance Holdings, the largest asbestos claims insurer, declared it would cease paying compensation, and this was followed in October by the news that T&N, one of the UK's largest asbestos defendants, had obtained an administration order effectively halting any more claims from being made, while cheques already issued bounced.It is clear that those solicitors who represent claimants in such cases see a moral rather than legal argument at stake.Mesothelioma - a most painful form of cancer - was discovered in South Africa during the late 1950s and has been recognised by the Benefits Agency since 1966.

It afflicts about 1,700 people annually with numbers on the up.

Most victims die within two years of symptoms starting.The Association of Personal Injury Lawyers' (APIL) secretary, Mark Harvey, a partner in the Cardiff office of Hugh James Ford Simey, says: 'Someone with mesothelioma comes to you and you realise that person is likely to be dead in a few months, and neither they nor their dependants are likely to see any compensation.'He maintains that unless the House of Lords overturns the decision, the ramifications will spread far beyond cases involving mesothelioma, taking in not only other asbestos-related claims but also other cancers, illnesses and clinical negligence claims.Mr Harvey says medical experts are already debating whether other complaints should be viewed as the result of a single incident of exposure rather than the generally accepted principle of cumulative damage.There is a belief that even in cases with only one defendant, outside causes such as background pollution will be cited as reasons why claims should fail.In addition, Mr Harvey contends that the concept of material contribution to risk - by which two or more defendants who materially increase the claimant's risk of injury by their breach of duty are then held to be making a material contribution to the injury itself - is also under threat.Other observers reckon this battle was always one that was likely to happen, as insurance industry lawyers looked to halt the ever-increasing number of claims faced by their clients.Andrew Morgan, joint secretary to APIL's occupational health special interest group, and a personal injury solicitor at City firm Field Fisher Waterhouse, which also acts for claimants in the Fox and Matthews cases, says: 'We think insurance industry lawyers have been waiting for more than a decade for the right sort of case to arrive, so that this point could be argued.'Backing up Mr Morgan's opinion is the fact that the lawyer who led the defence in Fairchild used as the basis for his argument a long-forgotten House of Lords ruling from 1988.In Wilsher v Essex Health Authority [1988] Ac 1074, the Law Lords overturned a decision that a number of defendants were liable based on the familiar material contribution to risk argument.Chris Phillips, head of insurance litigation at Manchester-based Halliwell Landau, who acts for the main defendant in Fairchild, says that in the past, either the point made in that case had not been properly understood, or defendant solicitors had not thought the courts were ready to challenge established practice.He adds: 'Fairchild is a most important case for defendants, because until now they have been paying out on mesothelioma claims when a claimant has failed to show that they have actually caused the damage.'As for his opponents' attempts to play the morality card, Mr Phillips maintains that the concept is a two-edged sword, with many small companies in the past bankrupted by compensation pay-outs, even though causation was never pinned on them.'Morality and the law don't often coincide, but how moral is it if there are five defendants in a mesothelioma case and all of them are judged liable, even when it is known that four are innocent?'Personal injury lawyers are hopeful that even if the Lords do not overturn the previous decision, help might be on hand from the government.The case was discussed in Parliament on 16 January and during the debate, junior local government minister Alan Whitehead likened the decision to the consequences of legal proceedings where six hoodlums beat up a passer-by.

But as it was not possible to say with certainty who administers the kicks and blows, then nobody could be held responsible.He noted a system 'that allows all the people who have been mentioned this morning (insurance companies) to walk away from their liabilities would not be a satisfactory way forward.'It is not right that companies that are properly liable should be able to walk away.'As a result, the government has extended the Pneumoconiosis (Workers Compensation) Act - which was designed to compensate asbestos suffers unable to recover damages, for example, because the employer had gone out of business - to those situations where liability is in question.

But this will drain the public purse, and claimant lawyers want to see the financial buck stop with the actual wrongdoers.Mr Whitehead's comments emphasise the seriousness of the decision the House of Lords will make next month; the future of much personal injury/insurance work rests on its ruling.Michael Gerrard is a freelance journalist