Insurers out to scare public, parliament over Asbestos compensation payments

Ah the pain of it, paying out … which Insurers are definitely trying to avoid when it comes to Asbestos related compensation claims.

The Herald reports :

Asbestos payments ‘could reach £8bn’

STEWART PATERSON October 14 2008

The cost of compensating people with an asbestos-related chest condition has been significantly underestimated by the Scottish Government, according to insurers.

Ministers had estimated that the cost of compensating those with pleural plaques - scar tissue on the lung commonly caused by occupational exposure to asbestos - would cost £6.5m a year in 2015, and £5.5m the year before.

But the Association of British Insurers (ABI) has claimed that the annual cost could be as much as £607m - with the total bill potentially reaching more than £8bn.

The Scottish Parliament, Justice Committee yesterday published a report on the Damages (Asbestos Related Conditions) Bill, proposed by the Scottish Government to provide compensation to sufferers.

MSPs on the influential committee agree the government may have under estimated the costs, but also believe the insurers figures are a significant over-estimation.

Fergus Ewing, Community Safety Minister, told the committee it would need £17.1m to close existing cases with a further £5.5m needed annually to settle an anticipated 200 cases a year at a cost of £25,000 each. However, the ABI said costs would be far higher.

Many more people will come foreard following the new legislation

It argued: "The Scottish Government has significantly underestimated the level of unjustified costs that the bill will impose on defendant businesses, local authorities and insurers.

"Figures from the UK Government suggest that the annual cost in Scotland would be between £76m and £607m and the total cost between £1.1bn and £8.6bn."

A spokesman for the ABI said it was opposed to the bill on the grounds that you would not need to have suffered to claim compensation, but only to have been exposed. Their argument is based on an assumption that many more people will come forward following the new legislation.

They also agree with the House of Lords judgment that those with pleural plaques do not merit compensation as they have suffered no harm, despite it being an indicator of lung damage and can be a precursor of mesothelioma.

Nick Starling, director of general insurance at the ABI, suggested as many as one in 10 adults could have pleural plaques through exposure to asbestos giving the potential cost of £607m a year.

Dominic Clayden, director of technical claims at Norwich Union, drew parallels with the British Coal pulmonary disease scheme. He said 150,000 claims were expected, but by the scheme's closure there were almost 600,000.

He said: "That happened despite the availability of data that we have in relation to pleural plaques."

However, Thompson's Solicitors who have handled many of the claims in Scotland, said their estimate is 200 a year. Solicitor Frank Maguire said: "That has always been the rate. If the House of Lords decision had not gone the way it did, I have no doubt that the rate would have continued in the coming years." The Scottish Government introduced the bill in June this year, following the Lords' ruling, to ensure people north of the border could continue to make claims.

The Justice Committee recommended support for the bill, but expressed concern about the potential financial implications.

Research has shown that about one-third to one-half of those occupationally exposed to asbestos will have calcified pleural plaques 30 years after first exposure.

Asbestos compensation delays criticised by MP's family

Unjust delays in the payment of compensation for asbestos victims have been criticised by colleagues andf family of the late John MacDougall.

Such delays are enough to make one think the Government is waiting for people to die off so they don’t need to pay any compensation .. and tie up deceased's estates for years over whether such compensation is to be paid after death …

The Herald reports :

MP’s family criticises delay in compensation for asbestos-linked illnesses

DOUGLAS FRASER, Scottish Political Editor August 25 2008

The compensation delays for people facing painful deaths from asbestos-linked diseases have been strongly criticised by those close to John MacDougall, the Glenrothes MP who died while suing the government over his illness.

The Labour MP fell victim earlier this month to mesothelioma, a painful and incurable condition that slowly stops the lungs or heart from functioning. While his death quickly moved on to a debate about his party's risk of losing the seat to the SNP in a by-election, the circumstances still have the capacity to embarrass UK ministers.

Mr MacDougall claimed he contracted the disease while employed in Rosyth naval dockyard. As a teenager, he worked next to men stripping old asbestos insulation from pipes and replacing it with a new coating. This was before it was clear how dangerous even a particle of the material can be if it is breathed in.

At the time, the Rosyth base was owned by the Ministry of Defence, which is why Mr MacDougall was suing the government for compensation, and his widow and family are to pursue the case. His long-time friend and constituency researcher, Scott Brady, was scathing about the delays, while lawyers wrangle over proof of whether the Rosyth was the only place the MP could have ingested asbestos.

That is standard procedure in compensation cases, but it means cases are typically drawn out much longer than the time the victims of mesothelioma have left to live.

Mr Brady said: "It's fundamentally wrong that a court can take longer than the median survival time to come up with a compensation figure. This is an appalling disease. There is no cure. You have no idea the pain that man went through, particularly in the last nine months. A quick resolution would be easier on the family."

A statement from the MoD said: "We have every sympathy with John MacDougall's family. In this case, as in all others, the Ministry of Defence considers claims for compensation on the basis of legal liability. Where there is a proven legal liability to pay compensation, we do so."

Efforts have already been made to improve the compensation process, including the promise that courts will speed their procedures. The law was changed at Holyrood to end the choice previously faced by victims of mesothelioma between a compensation pay-out while they were alive and a bigger sum for their family after their death.

Today, at Holyrood, a legislative effort gets under way to help those who face workplace hazards with employers' criminal liability. SNP back bencher Bill Wilson is sponsoring a bill on the subject and will launch it for public consultation.

Claim for anything, as long as its not against a lawyer !

Reminding us all we can lodge claims for just about anything, as long as its not a claim of negligence against a member of the legal profession - or any other friendly profession to lawyers who happen to be insured by the same insurers !

The Scotsman reports :

Don't forget that the repeat players have a massive advantage

By Brian Fitzpatrick

IN THE early 1970s, US legal theorist Marc Galanter published Why the "Haves" Come Out Ahead.

Nowadays, his central thesis might seem obvious and his characterisations a bit simplistic. He says the world of litigation is made up of "one-shotters" and "repeat players". One shotters are the majority of ordinary citizens who rarely find themselves in a court case – perhaps a divorce or custody battle or suing after an accident.

Repeat players are those involved "in many similar litigations over time". Examples would be the prosecution service, insurance companies, commercial lenders and landlords.

One-shotters are generally individuals, have few resources and are litigating for immediate one-off outcomes. Repeat players tend to be relatively wealthy in scale and resources, and often "pursue long-run interests".

As seasoned litigators with deep wallets, repeat players enjoy what Galanter calls "advance intelligence" from going through similar litigations.

Professionals rather than enthusiastic amateurs, they can "structure the next transaction and build a record. It is the repeat player who writes the form contract, requires the security deposit, and the like".

As we look on at the behaviour of banks and finance houses who created the credit crisis and yet devolve its results on to more onerous and expensive obligations for individual customers Galanter's observations take on a current-day significance.

Northern Rock, amid all its problems, has little difficulty in repossessing homes at a rate outstripping its competitors and with much more chance of success than the debtor in financial straits, trying to keep a roof over his family's head.

The war-chest of experience built up by repeat players finds arms in expertise aided by an ability to access specialist lawyers and paid experts who service litigation.

The small-firm lawyer seeking to secure a report from a medico-legal expert might have to wait a while – the insurer who pays by return or instructs reports by the hundreds can secure a report in days.

The repeat player makes sure to secure the services of the highly expert major law firms. In turn those firms can access even more expert practitioners at the Bar while increasingly acting as vocal lobbyists for the interests of their clients, even if losing the odd individual case. The repeat player can bear the cost of losing cases far better than any individual. So, when negotiating, it can apply pressure the one-shotter might find irresistible.

If you are a spinally injured car accident victim with a claim of £2.5 million, a "final offer"of £2 million will make you think long and hard. The UK insurance industry, through huge investment in its case management system, knows better than any judge and most claimant lawyers just how much money is needed to see off a troubling claim.

It is not all one-sided. Here in Scotland expert claimant lawyers have, to some considerable extent, evened up the field. Asbestosis, deafness, white finger and other mass litigations would never have secured the sums achieved for thousands had there not been trade union-backed law firms trading blows with insurers.

Legal aid has also provided some measure of antidote, though, nowadays, with a legal aid certificate being somewhat more rare than the proverbial unicorn it represents more a case of providing some bandaging rather than proper even-handed access to justice.

The various equalities bodies have taken up cases and advanced the rights of women and ethnic minorities but with very straitened resources. Making sure that ordinary citizens can secure access, not just to the courts but to expert lawyers has to be at the heart of any debate on the future of our legal system.

Speaking recently in Edinburgh, Lord Rodger reminded lawyers that achieving justice between the parties "not just a result" was what our civil justice system should be about. As we discuss the next phase of Lord Gill's review of the courts we might bear in mind Lord Rodger's concerns that, when considering proposals to divert personal injury cases to the Sheriff Courts, account has to be taken of the potential of diverting work from a globally recognised centre of expertise. Gallanter would have smiled.

• Brian Fitzpatrick is an advocate in the Ampersand stable

Juries should be allowed to set compensation levels in Scottish courts

The public and justice at large could benefit if citizens were allowed to set compensation levels in cases across the board, particularly when it comes to the far too complicated question of negligence claims, which are designed with big business in mind ... not the individual ...

The Scotsman reports :

Let citizens set fair levels of compensation

By ANGUS LOGAN

I RECENTLY had the pleasant experience of helping to arrange a conference of European personal injury lawyers (the PEOPIL organisation) here in Edinburgh.

The conference was all about road traffic accident cases and, in particular, civil compensation in road traffic cases in the different European Union (EU) states.

The delegates were very seduced by Edinburgh as a city and Scotland as a country. They were also interested in the marvellous legal surroundings in which our conference took place: the beautiful Signet Library, cheek-by-jowl with the Court of Session building.

What was of particular interest to these members of PEOPIL was that a civil jury trial was taking place next door in the Court of Session. Not only were the lawyers from the various European jurisdictions surprised that a civil jury trial could take place in an accident-at-work case (as in this particular trial) but that it could also have taken place for a pursuer involved in a straightforward road traffic accident.

The right to civil jury trial in reparation actions that exists in Scotland was also of interest and some bemusement to experienced English lawyers who were present (given that they can only obtain a civil damages jury in cases involving claims against the police). Some of the PEOPIL delegates took the opportunity to observe parts of the jury trial that was going on next door.

The foreign visitors were very struck by the ceremonial aspect of the Scottish court, the wigs and gowns of counsel and the presence of the jury in a civil damages case. In the Court of Session, only two such jury trials are allocated each week because of administrative limitations, although the great majority of such cases do settle.

One of the speakers at the conference was Andrew Hajducki QC, of the Scottish Bar, who has written extensively on the subject of civil juries in our system. Jury trials do put pressure on insurers to settle cases and, equally, place pressure on the pursuer's lawyers to be realistic about what a jury might award or not. A mature lawyer from Porto remarked to me on the sheer dignity but also the peer-group efficacy of the jury proceedings in terms of "instant" justice.

There has been a tendency noted over the years for juries to approach damages actions in a slightly different way from the way in which a judge sitting on his or her own would decide the case. For instance, a jury might make a more generous award for pain and suffering than a judge might make, but sometimes has been known to make a less generous award for future loss of earnings. There is a school of thought that a case with a large and complicated future earnings potential is better heard by a judge.

On the other hand, it is commonly believed that a jury will be more generous, particularly to a sympathetic-seeming pursuer, and that it is a good strategy to bring such a case of that pursuer's serious injuries before a jury for an award .

Juries in civil cases are, of course, quite common in the North American legal jurisdictions but are unknown in England and Wales (other than the police type of case referred to above) and, as I say, are quite common in Scotland, as an exception to both the European and common law systems.

There have been mutterings over the years to abolish civil jury trials in Scotland but I think that these moves should be opposed. Why abolish the very jewel in the crown of our distinct civil justice system?

Indeed, rumours abound that personal injury cases may be removed from the Court of Session and its judges and juries altogether and sent to the Sheriff Courts. We would thus have a system where murderers and criminals have their trials take place before judges and juries in the highest courts in the land but seriously injured victims of personal injury would have no equivalent right to process in the higher courts.

Jury trials in civil-damages actions in Scotland provide a valuable lay input into damages actions and afford to ordinary citizens – balloted from the electoral roll, as in criminal cases – a chance to decide what their peers should be awarded in personal injury compensation cases.

At this time, when the insurance industry has been extremely clever in floating (in my opinion) a canard that there is a "compensation culture" in the UK, civil juries might very well provide an acceptable remedy whereby levels of compensation were decided regularly by juries rather than by judges. It is certainly an idea worth considering.

Perhaps juries could be more widely used to decide civil compensation actions in the UK jurisdictions other than simply in Scotland?

As I watched the high-value jury trial of a badly injured woman pursuer unfold before the admiring gaze of a public that included the PEOPIL European delegates, I felt proud of our Scottish legal system, of its history, traditions and virtues, such as the right to civil jury trial under the 1988 Court Of Session Act. It occurred to me too that it actually might be desirable to extend civil jury trial to Sheriff Courts in addition to the Court Of Session. Then we really would find out from our citizens what levels of compensation are fair and reasonable for men and women in the Scottish street.

• Angus Logan is head of litigation at Ritchie Neill.