Mesothelioma Bill

The House of Lords have made their final adjustments to the Mesothelioma Bill before sending it off to the House of Commons, who will begin considering it after the summer recess. The Bill is designed to provide compensation for mesothelioma victims where their former employers who negligently exposed them  to asbestos are no longer in business and the compulsory employers liability insurance policy cannot be found.

Lord Freud, who piloted the Bill through the House of Lords for the government, introduced a curious amendment in the Third and final reading of the Bill; an amendment he described as minor and technical in  nature, which requires that a claimant before seeking a payment under the provisions of the new scheme must first have exhausted all other options in respect of bringing a claim for damages against any former employer or their insurer, who has negligently exposed them to asbestos.

Thus, the amendment, which was passed without challenge, raises some interesting questions. On its face the amendment’s requirement seems logical, but looked at closely potentially difficult issues quickly seem to emerge. The Mesothelioma Bill provides that those eligible will be able to receive from the insurance industry funded scheme about 75% of the compensation they would have been able to obtain from their former negligent employer or the employer’s insurer. So it would seem sensible that a claimant rather than seeking a reduced level of compensation from the new scheme would look to obtain full compensation from a former employer. But a quick example highlights potential difficulties. It may be that there is clear evidence that the claimant was exposed to asbestos whilst working for Employer 1, but there is doubt as to whether negligent exposure occurred whilst working for Employer 2. Employer 1 is no longer in business and no insurance policy can be found, so should a legal action be raised against Employer 2? In many instances the former employee is likely to have already passed away before the action is raised, and evidence of negligent exposure to asbestos may be at best patchy. How would a claimant’s solicitor view such an action? Loss making potentially for them, but Clause 2 of the Mesothelioma Bill does state that all avenues must be exhausted before a claim under the new scheme can be made. How that is to be enforced will be interesting to see.

A second issue from the amended Clause 2 comes in respect of a possible contradiction with section 3(2) of the Compensation Act 2006. Section 3(2) was introduced to over rule the judicial decision in the House of Lords of the 2006 case of Barker v Corus, in which their Lordships held that an employer who negligently exposed an employee to asbestos would not be liable for the full amount of damages where other former employers had also exposed the employee to asbestos dust, with all employers being liable only on a proportionate basis. Section 3(2) provides that an employee can sue any of their former employers for the full amount of damages for the mesothelioma they have suffered, and such employer’s would then themselves if they chose to could seek financial contributions from the other employers that were not sued.

Arguably Clause 2 does not sit easily with section 3(2), as under section 3(2) a successful action against one former employer or their insurer triggers a full compensation payment, but under the new scheme whilst it may be perfectly possible to show that a particular employer was negligent, that will not necessarily trigger access to a payment where they are no longer in business and no insurance policy can be found.

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