Jack Straw, Secretary of State for Justice, announced on 22 July 2009 that the Government would be delaying its decision on whether to introduce legislation to reverse the House of Lords’ decision on pleural plaques in Rothwell [2007] and so allow pleural plaques to become a compensatable condition. A draft Private Member’s Bill, the Damages (Asbestos–Related Conditions) Bill has already been tabled by Andrew Dismore MP at the beginning of this year, seeking, in the absence of government initiative, to impose liability for pleural plaques and for asymptomatic asbestos-related pleural thickening and asbestosis. This Bill is currently making relatively unhindered progress through Parliament and will reach its report stage on 26 October 2009.

The Government’s delay on its own stance on legislation almost certainly arises as a result of deliberation, following publication in June of the Industrial Injuries Advisory Council’s working group’s conclusion that pleural plaques should not constitute a compensatable disablement for the purpose of benefits under the industrial injuries scheme.

The Scottish Parliament has already legislated controversially, by way of the Damages (Asbestos-related Conditions) (Scotland) Act 2009, making pleural plaques and asymptomatic pleural thickening or asbestosis compensatable conditions in Scotland. That Act is currently subject to judicial review, a process that is unlikely to be concluded before autumn this year. Actions commenced since the passing of the Act have been stayed pending the outcome of the judicial review.

In the meantime, Newcastle-upon-Tyne County Court has been the forum for consideration of 33 mixed asymptomatic pleural thickening and asbestosis claims. His Honour Judge Walton gave judgment in four test cases in February this year on the initial issue of actionability. Two Claimants, Mr Beddoes (fibrosis) and Mr Cooksey (asbestosis) were successful and two failed. In his judgment on actionability, the Judge concluded that a very low level of disability due to asbestos - as low as 1.25% - would be sufficient to make a claim actionable. Furthermore, he stated that such injury and disability may be identified solely by the medical expert, even where the claimant himself is not giving an account of symptoms. The Judge commented “if medical science can identify an effect upon the claimant before he is aware of a symptom, that can amount to damage, provided it is more than minimal”.

Judgment on quantum in the two successful lead claims was delivered on 14 July 2009. Accepting that the symptomatic element of the conditions was minor, on a “provisional” settlement basis, the Judge stated he would award £9,000 each to the two successful Claimants. As an alternative “full and final” basis of settlement, the Judge took his lead from the comments of Lady Justice Smith, the dissenting Court of Appeal Judge in Rothwell. Lady Justice Smith’s formula, taking account of percentage risk of development of serious asbestos disease, accelerated receipt of damages and a figure for the provisional award, was preferred, producing awards to Mr Beddoes of £11,375 and to Mr Cooksey of £13,612.50, both awards to be supplemented by amounts for provable actual pecuniary loss (e.g. nursing care, or loss of pension, again subject to percentage risk), to be agreed by the parties away from court.

The judgment overall is therefore not yet complete, as pecuniary loss aspects and costs disputes need to be finalised before the final judgment is handed down, possibly in October. At that time decisions will be made on the merits of appeal.

Subject to any appeal, in due course the remaining claims in the group will be settled, abandoned or submitted for court directions, for decisions on actionability and damages on their individual facts in the light of the conclusions reached in the four lead claims.

The machinations of the Newcastle County Court may prove to have been wholly or partly unnecessary if the Government legislates, if the Private Member’s Bill goes through, or if the Scottish Court concludes the judicial review before judgment is completed.

It is to be hoped that the Government will await the outcome of the judicial review before it decides what action it needs to take in England and Wales. If not, we could have a situation where the Government introduces similar legislation to that in Scotland, but the European Court of Human Rights ultimately decrees that the Scottish Parliament lacks legislative competence and/or that the Scottish Act is incompatible with its convention on human rights. That would mean that the current situation would be reversed, with English pleural plaques victims able to sue and Scottish victims unable to do so. That would be the ultimate irony, having regard to the Government’s initial lukewarm response to the demand that it should introduce legislation, which would negate the House of Lords’ decision in Rothwell.

The potentially expensive issues of pleural plaques and asymptomatic asbestos conditions remain fraught with controversy. Insurers or businesses with long tail risks are advised to keep up to date with developments, which we will report on a regular basis.