Supreme Court rules that the Welsh legislature cannot make insurers retrospectively liable to cover NHS costs

In 2013, the Welsh Assembly passed the Recovery of Medical Costs for Asbestos Diseases (Wales)  Bill. This provided that those liable to the victims of asbestos-related diseases would be liable  to reimburse Welsh Ministers for the costs of NHS services provided to such victims. It further  provided that where liability to the victims was to any extent covered by  an insurance policy, the  policy would be treated as covering the liability for NHS charges too and such liability cannot be excluded or restricted. The bill therefore imposed new liabilities on compensators in respect of  past conduct and on liability insurers under past insurance contracts.

Insurers argued that the Welsh Assembly did not have legislative competence to pass this Bill. The  Supreme Court has now upheld that challenge. The Bill did not fall within the powers granted to the  Welsh Assembly under the Government of Wales Act 2006. Furthermore, the Bill 

infringed article 1 of Protocol 1 of the Human Rights Act 1998, which provides that “Every natural or legal person is entitled to the peaceful enjoyment of  his possessions. No one shall be deprived of his possessions except in the public interest and  subject to the conditions provided for by law and by the general principles of international law”.

We understand that a similar bill is going to be put to the Scottish Parliament this summer.