Calculating damages in claims for asbestos-related conditions

In the last few months there have been some exciting developments in the courts that are likely to have wide-ranging implications. In particular, the Supreme Court is expected to give judgment in the appeal of Knauer v Ministry of Justice [2014] EWHC 2553 (QB). Given the significance of the point highlighted in this case, the matter leapfrogged to the Supreme Court, and it is understood the trial has now finished.

While we do not know the outcome, it is expected and hoped the Supreme Court will overturn the long-established principle laid down in Cookson v Knowles [1979] AC 556. This House of Lords decision held the multiplier for dependency in Fatal Accident Act claims should be assessed by reference to the date of death as opposed to the date of trial. This has meant many claimants in fatal accident cases have ended up significantly worse off because a lower multiplier is applied to the calculation of their dependency losses. In addition, the dependency sum awarded between the date of death and date of trial is subject to a discount for accelerated receipt, which is unfair given the claimant only receives the award at the date of trial and not before.

As such, the principle in Cookson has received much criticism, particularly from the Law Commission, and its harsh effects are clearly evident in Mr Knauer’s (K’s) claim.

Dependency assessment

K’s wife developed mesothelioma, from which she sadly passed away in August 2009. She was only 46 and had three sons.

K pursued a claim and proceedings were issued in August 2012. The services dependency award he claimed for past losses was in the region of £88,000 and future services were £329,000 approximately. In respect of income dependency, K claimed sums of around £23,000 and £82,000 for past and future losses respectively.

Given the relatively high dependency sums claimed and the time period between the date of death and trial, it was clear the effect of Cookson would be substantial. Therefore, when this matter went to trial at first instance in July 2014, counsel for K invited the court to depart from Cookson. However, while Mr Justice Bean stated he would be happy to follow that course if it was open to him, he considered he was bound by the House of Lords decision. As such, he assessed dependency by reference to the date of death.

As a consequence, this case has been appealed. Given the considerable disadvantage of this rule to K in this case and to claimants generally, it is hoped the Supreme Court will overturn Cookson. 

Test for causation

Moving away from quantum to liability, the recent case of Carder v Secretary of State for Health and University of Exeter [2015] EWHC 2399 (QB) considered an interesting point on causation.

Mr Carder (C) developed asbestosis as a result of being exposed to asbestos in his past employment as an electrician with several employers. As is common in such ‘long tail’ disease cases where there is a long delay between the breach and development of the disease, it can be challenging to either track down a live defendant or identify their insurers. This means the choice of defendants can be limited. 

Added to this is the fact asbestosis is classified as a ‘divisible’ disease, meaning each source of the claimant’s asbestos exposure is considered to have contributed to the development of their disease in approximate proportion to the dose of asbestos each source provided. Therefore, if the asbestos exposure with a particular employer amounted to 10 per cent of the claimant’s total exposure, then that employer would be responsible for meeting 10 per cent of his damages. 

At the time of trial in C’s case, only the second defendant (U) remained, and it was agreed this defendant was only responsible for 2.3 per cent ?of his total exposure. 

While C’s medical expert considered this was above de minimis, his view was that if the asbestos exposure with U never occurred, there would have been no change or effect on the condition and appearance of asbestosis on C’s lungs, his lung function tests (which are designed to test breathing ability), his perception of his symptoms, and his ability to cope with daily life. Therefore, and on the basis of this opinion, U claimed the test for causation was not made out as it did not contribute to C’s injury.

Judge Gore QC agreed the medical evidence proved that U’s exposure, while contributing ?to C’s total exposure to asbestos, made no contribution the disease. However, the main question was whether U caused C to suffer real damage which made him worse off to a degree that was not so trivial as to not justify a claim for damages.

In answering this question, Judge Gore identified numerous relevant factors. First, while U’s contribution to the total asbestos exposure was small, it was not de minimis. Also, he noted C had a 50 per cent chance of his asbestosis deteriorating such that he would become bed ridden, which is something that would be taken into account when assessing general damages. Finally, anyone diagnosed with this disease is considered to be at an increased risk of developing other, potentially more serious asbestos-related conditions, such as lung cancer and mesothelioma, when compared to the general population. 

In light of these reasons, among others, it was ruled C had suffered actionable damage, and ?so he succeeded in his claim. The total sum of his damages was assessed at £67,500 on a provisional basis. While this seems reasonable given his condition, C will, for the reasons given above, ?only receive 2.3 per cent of this sum. 

Although many would say this is a relatively low amount, the key point is C succeeded in achieving settlement on a provisional basis. Therefore, in the event that he developed a more serious asbestos-related illness, he would be able to seek further damages. In particular, if he developed mesothelioma, C would be able to recover his full compensation from any single defendant, even if their contribution to the total exposure was low.

Issuing proceedings

While the above cases represent positive developments for claimants, the ruling in Lewis and others v Hadaway [2015] EWHC 3503 (Ch) serves as a stark warning for those issuing proceedings.

This was a professional negligence matter advanced on behalf of 31 claimants. These cases were all issued very close to limitation and the fees paid by the claimants’ solicitors (CS) suggested most of the claims were worth up to £15,000 each. However, the letters of claim sent to the defendant previously suggested the values of the claims were considerably higher. In fact, the court was informed the total value of all 31 claims was in the region of about £9m.

For this reason, and even though the claim forms were subsequently amended by the CS and the difference in issue fees paid, the court held there was an abuse of process. While there was always the intention to pay the difference, the court considered such practices would affect the court’s cash flow and increase its administrative burden in having to deal with two sets of claim forms as well as any amendments. In addition, and given the CS appeared to be aware from the letters of claim that the values would be much higher, there was a public interest in discouraging claimants from acting in this manner.

Thankfully, though, the court, having regard to the overriding objective, concluded that striking out these claims would be disproportionate. 

However, 11 of the 31 claimants were not so fortunate. In these cases, it was noted the claim forms were delivered to the court office within the limitation period, but issued after it. This is not usually a problem as practice direction 7A, paragraph 5.1, provides the action is ‘brought’ for the purposes of the Limitation Act 1980 on the earlier date (i.e. when it is delivered to the court). However, by reference to Page v Hewetts [2012] EWCA Civ 805, the court considered a claim form was only deemed brought if it could also be shown the claimants had done everything in their power to initiate proceedings within time. As the claim forms were not delivered with the proper fee when the CS knew otherwise, the court ruled that these 11 claims should be statute barred. 

It should be noted these 11 claimants did not have the option of asking the court to exercise its discretion under section 33 of the Limitation Act as this is not available in professional negligence claims. Therefore, these claims had to be discontinued. 

The circumstances in this case were unusual because the CS knew before that the claims were worth more. It is hoped, therefore, that where a claimant includes a reasonable valuation in the claim form which they ‘genuinely’ believe the claim is worth, the court will be less likely to consider there was an abuse of process. 

However, this case should still be seen as a warning against paying a fee which it is known is unlikely to reflect the full value of the claim, even if there is the intention to pay the difference later. It also highlights the risks associated with issuing too late.

Vijay Ganapathy is a partner at Leigh Day @LeighDay_Law www.leighday.co.uk