The Supreme Court’s decision in Sienkiewicz v Greif ( UKSC 10) is a detailed analysis of the “special” jurisprudence applicable to liability for causing mesothelioma. The UK’s highest appeal court was reviewing the application of the “Fairchild exception” to single rather than multiple asbestos exposure cases.
The Fairchild Exception
In 2002, the House of Lords’ decision in Fairchild v Glenhaven Funeral Services ( 1 AC 32) introduced an “exception” to the normal rule of causation. A victim would normally have to prove that on a balance of probabilities a defendant’s negligence caused a disease; this is the “but for” test. Mesothelioma is for all practical purposes caused only by exposure to asbestos fibres. However, in circumstances where a victim has been tortiously exposed by different parties (multiple exposures), the limits of medical knowledge mean that it is impossible to identify which exposure or exposures in fact caused the mesothelioma. In Fairchild, the court relaxed the rule of causation. That relaxation was developed in the subsequent House of Lords’ decision in Barker v Corus ( 2 AC 572). The position was further varied by section 3 of the Compensation Act 2006.
The Supreme Court set out the Fairchild exception in its current form as follows: when a victim contracts mesothelioma each person who has, in breach of duty, been responsible for exposing the victim to a significant quantity of asbestos dust and thus creating a “material increase in risk” of the victim contracting the disease, will be held to be jointly and severally liable for causing the disease. In broad terms, where a victim would normally have to prove that it is more likely than not that the defendant caused the injury, a mesothelioma victim can succeed by proving only that a party’s negligence might have caused the disease.
In Sienkiewicz, the court looked at two cases where there had been only a single negligent occupational exposure; and that exposure had been relatively “small”. The only other exposure had been “environmental exposure”, a “low-level exposure to asbestos in the general atmosphere” for which no one is responsible. The Supreme Court held that the Fairchild exception applied in such single exposure cases. The victims merely had to show that the tortious exposure created a material increase in the risk. In the case of one of the victims, the negligent occupational exposure had been found to increase the risk to which environmental exposure subjected her by only 18%.
Material Increase in Risk
The court made it clear that a low threshold would apply when considering what constituted a “material increase in risk”. The court commented that “material” in this context means any exposure that is more than de minimis, but that it was not possible to define in quantitative terms what is de minimis. This remains a question for the judge on the facts of a particular case. In his leading judgment, Lord Phillips said: “The reality is that, in the current state of knowledge about the disease, the only circumstances in which a court will be able to conclude that wrongful exposure of a mesothelioma victim to asbestos dust did not materially increase the victim’s risk of contracting the disease will be where that exposure was insignificant compared to the exposure from other sources”. The court referred to the expert evidence that there is no known lower threshold of exposure to asbestos that is capable of causing mesothelioma. Lord Phillips noted a case in which a defendant had conceded that a week’s exposure would not be de minimis.
The court rejected the argument that a mesothelioma victim should prove that the tortious exposure more than doubled the existing risk. The “doubles the risk” test is usually applied to epidemiological evidence. The potential value of such evidence was the subject of lengthy discussion. The rationale of the test is that if the action of a wrongdoer more than doubles the risk that a victim would suffer injury, then it follows that it is more likely than not that the wrongdoer caused the injury. The judges showed varying degrees of doubt that epidemiological evidence alone could ever be the basis for a finding of causation. The essential shortcoming of such evidence is that it demonstrates only a statistical association rather than a causal relationship. The Supreme Court pointed to at least one previous decision in which a court appeared to have incorrectly muddled the principle of “material increase in risk” with the “doubles the risk” test.
Section 3 of the Compensation Act
The court reviewed the scope of section 3 of the Compensation Act 2006. The Fairchild principle was refined in the decision in Barker, in which the House of Lords held that each defendant held responsible under the Fairchild test for causation was liable only for that proportion of the damages which represented his contribution to the risk that the employee would contract mesothelioma. Within a few months, section 3 had been enacted, reversing this aspect of the Barker decision by providing that any party found liable for causing mesothelioma is jointly and severally liable for the whole of the damage.
The court found that section 3 does not create a new statutory tort of materially increasing the risk of developing mesothelioma. That legislation had been misread by the Court of Appeal. Whether and in what circumstances liability in tort attaches to a party who has materially increased that risk remains a question of common law, currently contained in the Fairchild and Barker decisions. The common law in this area is capable of further development: for example, the courts might revert to the conventional balance of probabilities test should advances in medical science make this appropriate. Section 3 has limited scope: it is relevant only in circumstances where a defendant has first been found liable in tort in accordance with the common law; it has no relevance to the establishment of that liability.
Special Mesothelioma Jurisprudence
Several members of the Supreme Court expressed their unease at the special rules that apply to mesothelioma and warned of the consequences of tampering with the standard test of causation. Lord Phillips remarked that the combination of the Fairchild exception and section 3 has “draconian consequences” for an employer who has been responsible for only a small proportion of the overall exposure of a claimant. Lord Brown said he found the position “unsatisfactory” and that the path to the current situation was “quixotic”. There was, however, an acknowledgement that reversing Fairchild would be fruitless as Parliament would be likely to reinstate the principle.
This Supreme Court has confirmed, with some obvious reluctance, the wide application of the Fairchild exception in mesothelioma cases. Lord Brown remarked that mesothelioma claims must now be considered “a lost cause” from the defendant’s perspective. This is of concern to defendants and their insurers, given the magnitude of this problem. The latest estimate from the UK Asbestos Working Party is that mesothelioma claims will cost insurers about £10billion – and perhaps even double that - over the next 40 years.
While apparently expressing the general view that the Fairchild exception should apply only to mesothelioma cases, there was some desultory discussion of the exception, or at least the underlying logic of it, in the context of diseases other than mesothelioma (such as lung and other cancers) that can be caused by more than one activity or type of exposure (known as “multiple agent” cases). This analysis appears to have created a degree of uncertainty and to have identified that the exception could be argued logically to apply outside the confines of mesothelioma cases. It may be that only policy considerations would prevent the exception being applied more widely.