Trust set up for asbestos victims

A long-running battle to win compensation for South African asbestos miners is drawing to an end after the law firms that acted for the victims closed separate deals worth a total of almost 50 million.

The first agreement - aimed at compensating some 4,000 victims who were exposed to asbestos dust by mining giants Gencor and Gefco - was concluded by national trade union firm Thompsons and South Africa's Ntuli Noble Spoor last week.

Money will be paid out via a trust fund worth 37.5 million.

In return, Gencor will be allowed to 'unbundle' its assets for distribution among its shareholders; it was prevented from doing so while legal action was ongoing.

The law firms will be paid 2.75% of the award in costs.

The second deal reached by London-based Leigh Day & Co and Oldham's John Pickering & Partners on behalf of 7,500 claimants means that Cape plc - which sold its South African mines in the 1970s - will pay 7.5 million while Gencor will pay 3.2 million.

An original deal worth 21 million was struck with Cape in December 2001, but the later fell through.

Gencor was then added to the action.

The firms hope that the money will become available by June this year, when the unbundling should be completed.

Both agreements follow years of protracted legal negotiations and the deaths of hundreds of victims.

The Cape case established that UK companies can be sued in the UK for the actions of foreign subsidiaries.

Thompsons said it concluded that the trust was the most effective way of getting compensation to the victims while avoiding even more legal skirmishes.

'We regret that the trust does not cover Leigh Day's Cape claimants,' Thompsons partner Mark Berry added.

Leigh Day partner Richard Meeran said although the total overall compensation is half of what would have been paid out under the 2001 agreement, it will be paid in one instalment which is worth more to current claimants.

He added: 'There is no question that these cases are sending out a salutary warning to multi-national companies that in conducting operations overseas, they must behave in a responsible manner or they will be held to account legally.'

Paula Rohan