February 2010 newsletter - Disease Newsletter February 2010

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February 2010 newsletter - Disease Newsletter February 2010 Powered By Docstoc
					Disease Newsletter
February 2010
This edition includes a commentary on …

Our regular asbestos update, hand arm vibration syndrome, the Transfer of
Undertakings (Protection of Employment) Regulations 2006, (TUPE), an update
on the deafness test litigation, provisional damages, pension loss calculations,
proposed changes to the Third Parties (Rights against Insurers) Bill, limitation
and our regular review of trends and what is on the horizon.

Asbestos update

A regular feature in the disease newsletter providing an up to date roundup of
asbestos related issues. Gloria Ginvert provides an overview and Judith Peters
comments on the Damages (Asbestos Related Conditions) Bill and two recent
low level asbestos exposure decisions.

Hand arm vibration syndrome

Is it now possible to distinguish between a Claimant who has constitutional
raynauds and a Claimant who has a vibration induced condition? Jim Byard
comments on the recent study using a modified cold provocation test in an
attempt to distinguish between the conditions.

Deafness test litigation update

Has the Supreme Court granted permission to appeal? Jim Byard explains the
funding issue.

TUPE Regulations

Identifying the correct Defendant is not always straightforward in disease claims.
Lisa Watson and Russell Daw discuss the application of the TUPE Regulations
and what evidence will help determine whether a TUPE transfer has taken place.

Provisional damages

Has complacency set in? Victoria Douglas advises caution when agreeing terms
for provisional damages in respect of return conditions and time limits.
Pension loss calculations

What was the impact of the amendments to the sixth edition of the Ogden tables upon a pension loss
calculation? Paul Debney, explains its subtleties and sheds light upon pension loss calculations.

Third Party (Rights against Insurers) Bill

Proposed changes to the 1930 Act introduce a new streamlined process. Jim Byard explains the existing
legislation and the changes proposed by the bill presently before Parliament.


When does time start to run? Did the Defendants admission of liability prevent a limitation Defence? What
delay is relevant for the purpose of Section 33 discretion? Peter Ward provides a commentary on three recent
decisions where these questions were raised.


What does the future hold for new conditions and what is happening in the wider disease arena?        Gloria
Ginvert comments on a noise induced hearing loss claim from a cellist, the Jackson reforms, IPOD music
player class action, link between bowel cancer and eating processed meat, reports of nanoparticles causing
lung disease.

We hope you find our bulletin informative and we would welcome feedback on ways which in which we can
ensure that the bulletin best meets with your needs. The bulletins’ editor is Gloria Ginvert. This update
does not attempt to provide a full analysis of those matters with which it deals and is provided for general
information purposes only and is not intended to constitute legal advice and should not be treated as a
substitute for legal advice. Weightmans LLP accept no responsibility for any loss that may arise from reliance
on the information in this update. The copyright in this update is owned by Weightmans LLP.

If you require any further information on the articles within this bulletin or disease issues generally, please
contact Gloria Ginvert, Editor or Jim Byard, our Head of Practice Area.
January 2010
Asbestos update

        Discount for smoking.
        Show cause hearing.
        The Newcastle minimal asbestosis litigation.
        Policy trigger.
        Employers’ Liability Insurance Bureau Bill.
        Damages (Scotland) Bill.
        Post Office liabilities to asbestos exposed employees.
        Low level exposure to asbestos.
        Damages (Asbestos Related Conditions) Bill.

Discount for smoking

In Horsley v Cascade Insulation Services Ltd & Others [2009 the Claimant had asbestosis and a 12 % risk of
developing lung cancer because of smoking which increased to 36 % when combined with the factors of
asbestos exposure and asbestosis. The risk of contracting mesothelioma was put at 5 %.

Counsel for the Claimant argued that in respect of general damages, the JSB guidelines figure for asbestosis
of £45,000 was not clear over the extent to which it reflected the increased risk of mesothelioma and lung
cancer. He proposed taking 29 % (the added risks of lung cancer and mesothelioma) of the award for these
two conditions (in the order of £70,000), producing an additional figure of £20,300.    Thus, he argued that
the Claimant’s proposed figure of £55,000 for general damages was reasonable.

His Honour Judge Eady was of the opinion that this was too generous as he considered the JSB figure had
already factored in such risks.

He said that when at the stage of assessing risk, including an increased risk attributable to smoking, the
Defendants must take the victim as he finds him. Therefore at this stage any question of disallowance
because the Claimant had voluntarily undertaken risks related to smoking should be excluded.

This factor was however relevant when addressing the risk in this case of the Claimant being unable to work
in the future because of his smoking and following the decisions in Badger and Shortell the final award
would also be discounted for contributory negligence for smoking which he assessed at 20 %.

Show cause hearing

The recent decision in Revenue & Customs v Rita Silcock (Widow and Executrix of the Estate of Robert Henry
Silcock, Deceased) [2009] was an appeal by the defendant Revenue & Customs against a decision made at a
show cause hearing that it was liable for the fatal mesothelioma suffered by the respondent’s late husband.
The claimant widow was unable to provide any detail as to the precise period, sources and places of exposure
to asbestos dust. Her claim was on the basis that the Deceased’s exposure to asbestos was likely to have
occurred in the various buildings visited by her husband when employed by Revenue & Customs. Revenue &
Customs did not serve any evidence claiming it was for the respondent to establish evidence of lack of proper
precautions in relation to the dangers of asbestos.

The Deputy Master at first instance acknowledged that the burden of proof was still on the respondent but it
was for Revenue & Customs to show that it had an arguable Defence. He held that on the material available
to him he was able to draw an inference that there was exposure as alleged and there was no evidence of
Revenue & Customs taking any precautions to avoid the risk of exposure.

On appeal it was held that there was some evidence which put Revenue & Customs in difficulty and on
balance sufficient to conclude the Claimant would win on the exposure issue at trial. Whilst the Deputy
Master had correctly noted that the burden of proof was still on the Claimant and dealt correctly with the
burden of proof on the exposure issue, he was wrong to find that Revenue & Customs had been negligent.
At a show cause hearing, the defendant was only subject to an evidential burden to show cause after the
claimant had produced credible evidence in support of her case. Here the Defendant was able to submit the
Claimant’s evidence was insufficient to succeed in all likelihood. As Revenue & Customs had shown they had
some realistic prospect of defending the case the Deputy Master was wrong and the appeal was allowed.

Newcastle minimal asbestos litigation

Following Judgment on the above cases it was thought that both parties would be appealing. However it is
now understood that neither side is appealing and His Honour Judge Walton’s decision stands.

Policy trigger

The appeal hearing has been heard in the policy trigger litigation and Judgment is expected soon, probably in

Employers Liability Insurance Bureau Bill

This bill which proposes the creation of an Employers Liability Insurance Bureau providing a fund of last
resort received its first reading in the Commons on the 6 January 2010 and there is a provisional date for the
second reading of the 5 February 2010.

The compensation scheme proposes compensating persons in cases where personal injury or disease has
been caused in the course of employment by an employer which has become insolvent and has no employers’
liability insurance, or their insurer cannot be traced. Alternatively, any employer who was not insured in
accordance with the Employers Liability (Compulsory Insurance) Act 1969.

It is proposed the compensation scheme would allow payment of full common law compensation. It would
allow for contributions for funding to be imposed on Insurers underwriting employers liability insurance and
Further the bill would allow for the creation and maintenance of an employers’ liability insurance database
recording particulars of insurer, insured, period of cover, policy number and policy wording of any employers
liability insurance policy identified by investigation or enquiry.

Damages (Scotland) Bill

The challenge to Scottish legislation granting sufferers of pleural plaques the right to claim damages by way
of Judicial review by Insurers was rejected by the Court of Session earlier this month.

Post Office liability to asbestos exposed employees

The dispute between British Telecommunications Plc and the Royal Mail Group Limited was determined in
British Telecommunications Plc v Royal Mail Group Ltd [2010] earlier this month when it was held the
liabilities of the Post Office to employees who were exposed to asbestos whilst working in the
Telecommunications side of the Post Offices undertakings were transferred to British Telecommunications.

Gloria Ginvert, Partner, Weightmans LLP

Low level exposure to asbestos dust

Dianne Willmore v Knowsley Metropolitan Borough Council & Karen Sienkiewicz v Greif (UK) Ltd
The Court of Appeal has handed down its Judgment in two mesothelioma cases where the level of exposure
alleged was very low.

Mrs Willmore was a pupil at a school owned and operated by the Defendant Council in 1972. The school was
newly built and in common with many schools built around that time, used asbestos containing materials in
the construction and fitting out. The source of the exposure was said to be from ceiling tiles which had been
taken down by workmen and left stacked in a corridor along which the Claimant passed. In addition it was
found that some ceiling tiles had been left in the girls’ toilets and disturbed by the activities of girls.

The Judge at first instance concluded that the tiles more probably than not had contained asbestos, based on
the fact that in 2002 a ceiling panel in the corridor was found to contain amosite (brown asbestos). The
Court of Appeal did not uphold any further finding of exposure allegedly caused when pupils removed ceiling
tiles themselves to hide bags or coats in the cavity above.

No engineering evidence was considered by the Judge at first instance with regard to the extent of breathable
asbestos fibres that had been liberated. It was accepted that there was an inescapable level of ambient air
pollution including asbestos fibres, which represents a “background risk” to everyone and to establish liability
on the Council it would be necessary for Mrs Willmore’s exposure at the school to be more than minimal and
hence sufficient to materially increase the background risk.

The Court of Appeal did not accept the Appellant Council’s contentions that the Judge at first instance had
confused or conflated risk of exposure and risk of harm. The main issue on the appeal was whether the
evidence did support that there had been exposure to asbestos fibres sufficient to materially increase the
Claimant’s risk of contracting mesothelioma.
The Court of Appeal upheld the decision of the Judge at first instance who had found that the Claimant was
likely to have been close to the ceiling tiles which had been disturbed and that that was sufficient to place the
Claimant at increased risk despite the lack of any measurements or evidence as to the exposure that could be
expected from the circumstances described as compared to background levels commonly found in urban

In the case of Sienkiewicz the Claimant was an office worker employed by the Defendant company at their
factory from 1966 to 1984. The Claimant’s duties took her all over the factory and it was said that she spent
some time in areas which from time to time were contaminated with asbestos. Again in that case it was
accepted that the Claimant would have been exposed to “background” asbestos levels in urban areas.

The Judge at first instance found that the Claimant had been exposed in the manner alleged but that the
Claimant had failed to establish that the occupational exposure had at least doubled the risk that arose by
virtue of environmental exposure. He found that background exposure would have created a risk of
mesothelioma of 24 cases per million while the cumulative overall occupational exposure gave rise to a risk
of 4.39 cases per million. Hence the occupational exposure was undeniably very much the minority of the
Claimant’s total exposure.

The Court of Appeal considered whether the Claimant was required to show that the risk arising from the
tortious exposure was more than double the risk arising from the non-tortious exposure or whether the
Claimant only needed to show a material increase in the risk of harm. The Claimant contended that she only
had to show a material increase in the risk, relying on Fairchild and section 3 of the Compensation Act. The
Defendant argued that Fairchild did not consider the situation where there was only one occupational
exposure and the other source of exposure was environmental and further, that this case was not affected by
Section 3 of the Compensation Act as that section could only apply if liability was established applying the
principles established by Fairchild

The Court of Appeal, with Lady Justice Smith giving the leading judgment; found that Section 3 of the
Compensation Act applied to all mesothelioma cases including the circumstances of this case. The
requirement under Section 3 for the “responsible person” to be liable in tort was satisfied by proof of
causation by reference to a material increase in risk, i.e. on a Fairchild basis, even if the factual
circumstances of the exposure were such that, with the necessary evidence, it would be possible to prove
causation on ordinary principles as was arguably the case in this particular matter.

The judge at first instance had made an assessment of the respective occupational and environmental
exposure. Lady Justice Smith decided that it was not necessary for her to consider whether these
assessments were flawed but said that she remained “uncertain as to the validity of the whole process of
quantitative assessment in a case of this kind.” This begs the question as to how a Court can consider
whether exposure is more than minimal and hence has made a material contribution to the risk of developing

In his judgment Clarke LJ also concluded that this case would come within the Fairchild exemption as well as
within the ambit of Section 3 of the Compensation Act. Whilst in this case there was one exposure that
involved a breach of duty and a second (the environmental exposure) which did not, Clarke LJ also pointed
out this was also the case in Barker v Corus and in his judgment it was not necessary for all exposures to
involve a breach to come within the Fairchild exemption.

Asbestos exposure, encountered years previously, cannot be measured with absolute certainty whatever
means of assessment or measurement is employed, but there remains the question of by how much an
individual’s lifetime exposure to environmental background asbestos pollution is actually increased by very
small incidents of exposure, particularly in the type of circumstance described in Willmore It appears from
Willmore that almost any exposure however slight, and without any recognised assessment, will satisfy the
Fairchild test of making a material increase to the risk of mesothelioma and therefore if that exposure is in
breach of duty, liability will follow.

If that is correct the only means of defending similar cases will be in circumstances where it is possible to
defend the allegations of breach of duty or in cases where there has been substantial negligent exposure
elsewhere and, in comparison, the slight exposure is insufficient to materially increase the risk. The difficulty
of successfully defending allegations of breach of duty is exemplified by the Willmore decision in which it was
found that the Claimant had been exposed as a result of ceiling tiles disturbed and left in the vicinity
notwithstanding evidence to the contrary given by staff who had worked at the school at the time. The
circumstances of exposure in Willmore are likely to be common to what occurred in numerous other schools
or other public buildings of a similar construction in the 1960s and 1970s.

There has been recent research into the extent of background exposure in the environment, but instances of
slight or trivial exposure need to be evaluated and considered in the context of the extent of environmental
exposure and the risks from such exposure. In addition guidance is needed on the nature and extent of
exposure required to be more than “minimal”. It is understood that an application for leave to appeal to the
Supreme Court has been made in Willmore. It is to be hoped that the Supreme Court will provide such

Damages (Asbestos Related Conditions) Bill

On 16 October the Damages (Asbestos Related Conditions) Bill had it’s third reading without amendment and
passes now to the House of Lords. This Private Members Bill brought before the House of Commons by
Andrew Dismore MP seeks to reverse the effect of the House of Lords decision in Johnston v NEI International
Combustion Limited, which held that pleural plaques were not compensatable.

If this Bill is enacted and becomes law it will define pleural plaques as a condition constituting actionable
damages for the purposes of negligence in tort, even though the condition is not causing any impairment of a
physical condition or personal injury and will most probably never do so.

As Mr Dismore pointed out at the end of the debate, the Bill had no priority whatsoever and was a
presentation Bill, which resulted from Mr Dismore having spent the night on the floor of the Public Bill Office
to make sure he had first place in the queue.

Last year the government consulted on how to address the issue of pleural plaques. The consultation
included three different options: a no fault compensation scheme for the historic cases which had arisen prior
to the House of Lords ruling; a no fault compensation scheme to relate to both historic and future cases; or a
statute to overturn the effect of the House of Lords ruling.
The time for replies to the consultation ended on 1 October 2008 and significant time and effort was spent in
preparing responses to the consultation by those both in favour of and opposed to changes in the law as
established in the traditional way with decision having been made by the highest court in the land. It was
expected that the government would have set out their position by now, but have not done so, despite having
confirmed they would respond only for the suggested dates to pass.

The debates in parliament, both at second reading in April this year and on the third reading on 16 October
illustrated the emotive issues which surround the question of pleural plaques and whether or not they should
be compensatable. The Bill, according to Andrew Dismore, simply seeks to turn back the law to what it was
thought to be prior to the House of Lords decision in Johnston.

He said liability for such claims would be met by Insurers,, albeit providing the employer and/or their insurers
were traceable, as opposed to a scheme which would cost the tax payer. Mr Dismore said that his Act would
maintain the basic principles of negligence or breach of statutory duty as the test for liability. This, perhaps
conveniently, ignores the requirement not only for there be a breach of duty, but also for loss/damage to be
caused thereby to create a cause of action.

The main opposing view is that the law of tort/negligence should remain the same for all classes of action
and that there should be a standard definition of what was meant by damage. The dangers of changing the
law in a piecemeal way were highlighted.

It appears that a full range of opposing views was not represented in the debate. Indeed Mr Dismore thanked
those who had supported the bill and kept a “Trappist” rule of silence, presumably relating to limiting
knowledge of the possibility of debate and the prospect of numerous questions causing the Bill to run out of
time. Amendments were moved to defeat the retrospective element of the Bill in Clause 4, which suspends
limitation for the period between the House of Lords decision and the Act coming into force to allow claims to
be made by those with pleural plaques who had not previously had their cases decided or otherwise
concluded who would otherwise would have fallen foul of limitation.

In addition, amendments were proposed to allow claims from those who had pleural plaques which were not
causing symptoms but were “likely to cause” symptoms. However neither amendment was accepted.

At committee stage there was argument that those who had been exposed to asbestos but did not have
pleural plaques were still in exactly the same position as those with pleural plaques with regard to the risk of
further symptomatic asbestos related disease and hence should be included within the government’s
proposals. Whilst this is not a part of the Bill it is clearly a relevant consideration when considering the
potential repercussions of such legislation. Indeed, the case of Diane Wilmore v Knowsley Council was raised
in the debate on 16 October.

Mrs Wilmore contracted mesothelioma but her only exposure to asbestos fibre was as a school pupil in
circumstances where work was ongoing at the school whilst the school was open and asbestos ceiling tiles
were removed and left stacked in an area occupied by the pupils. The Court of Appeal gave their decision
dismissing the appeal made by Knowsley Council on 14 October 2009, the day before the Claimant’s death,
but has yet to pass down their full Judgment.
How many people will have encountered similar circumstances as schoolchildren? It is, of course, the
exposure and not the presence of pleural plaques that gives rise to the risk of future serious disease. Whilst
Mr Dismore stressed that the Bill was tightly drawn and hence in his view will not open the floodgates to any
form of parallel litigation, this will not prevent the legislation been cited as an example when considering
other asymptomatic conditions and situations where an individual is at risk of developing a medical condition
in the future.
The government’s position in respect of the Bill remains unclear. Bridget Prentice MP, Under Secretary of State
for Justice apologised for the delay of the government in responding to the consultation and stressed that the
government wanted to give support to those who had been exposed to asbestos. She mentioned that she
had met with medical experts the previous day with regard to this very issue and as a result further issues
were identified which the government wished to consider before publishing their response.

The Bill now goes to the House of Lords, where amendments may be made, which in turn would have to
return to the House of Commons during the life of the government. Having got this far, there remains every
prospect that the Bill be enacted. The support for the Bill reflected that there are many who clearly consider
that to leave the pleural plaques situation as it currently stands is simply not an option.

Judith Peters, Partner, Weightmans LLP
Disease – January 2010
Hand Arm Vibration Syndrome – A Diagnostic breakthrough?

Insurers continue to face thousands of claims for HAVS and CTS induced by vibration.
In addition to the reduced ‘safe’ exposure levels set by the Control of Vibration Work
Regulations (2005) those defending claims for HAVS have been unable to rely upon
an accurate diagnostic tool to determine whether the condition exists or whether the
condition has been caused by constitutional factors.

The symptoms displayed in hand/arm vibration syndrome or secondary Raynaud’s Phenomenon are
recognised to mimic almost entirely those of primary Raynaud’s Phenomenon which is a relatively common
constitutional condition affecting around 10% of the population of working age (DHS paper 1981).

The difficulty facing vascular consultants, employers and insurers alike is how to distinguish between a
claimant who has constitutional Raynaud’s and a claimant who has a vibration induced condition.

In the 1990s a test favoured by many Vascular Consultants was to immerse a patients hand in cold water
seeking to provoke the vascular and sensorineural changes associated with the condition. This form of
testing was largely discredited and has now fallen into disuse particularly following George Proud’s
epidemiological study published in 2003.

Since then Vascular Surgeons and Insurers have to a large degree been asked to take on trust a claimant’s
history of symptoms. That history has been regarded as the most important factor in determining whether
medical causation can be proven (Whalley v– Montracon Trailers CA 2005).

The absence of a method of objectively diagnosing the condition has led to suspicions of claimants unjustly
receiving compensation for a condition which is either constitutional or does not exist at all.

The attached paper which appeared in October’s journal of Hand Surgery suggests that there may now be an
objective method of confirming or denying the diagnosis.

The main findings

Salem et al used a modified cold provocation test in an attempt to distinguish between:-

    i.      Aetiologically normal patients.
    ii.     Those with primary Raynaud’s Phenomenon.
    iii.    Those with hand/arm vibration syndrome.

They used a standardised cold stress test to reduce finger temperature to 15 degrees C. The patients were
then measured to establish the time taken for their fingers to re-warm by 50 C.

The study established:

    1.      That those patients with primary Raynaud’s Phenomenon took longer to re-warm than
            aetiologically normal patients or those with hand/arm vibration syndrome.
    2.        That a difference of more than 7.50 C between the temperature of the finger and that of the room
              will not occur in patients with primary Raynaud’s or hand/arm vibration syndrome.

    3.        A temperature gain of equal to or greater than 2.20 C in the first 30 seconds on re-warming
              combined with a low base line temperature is strongly suggestive that a patient has hand/arm
              vibration syndrome.

In summary, the study suggests that there are statistically significant differences in temperature responses
between aetiologically normal patients, those with primary Raynaud’s and those with hand/arm vibration


It has to be recognised that this is a small study (176 patients) in comparison to Professor Burke’s study of
over 100,000 miners seeking compensation through the DTI scheme (2003). Additionally, the hand/arm
vibration syndrome patients forming part of the study were all seen for the purposes of medico-legal

Undoubtedly further studies are needed before this diagnostic test will be widely accepted in medico-legal
circles. It is however, an important step towards establishing a reliable and objective way of distinguishing
between those claimants who genuinely present with hand/arm vibration syndrome, those with a
constitutional condition and those with no compensable ‘symptoms’ at all.

Jim Byard, Partner, Weightmans LLP
Disease - January 2010
Nottinghamshire and Derbyshire Textile Case Litigation …. An update

The Supreme Court indicated by way of Order issued in November that it was prepared to grant Quantum
Clothing Group Limited and two other petitioners conditional permission to appeal the Judgment of the Court
of Appeal handed down in May 2009.

The Court perhaps anticipating the outcome of Lord Jackson’s report on the funding of civil costs indicated
that they wanted to ensure that the Respondent (Claimant) was properly represented upon any appeal.

We as petitioners have made funding proposals to the Respondent and at the time of going to press a
response is awaited from her instructing solicitors.

Jim Byard, Partner, Weightmans LLP
Disease - January 2010
TUPE: The difficulties in disease litigation

The Transfer of Undertakings (Protection of Employment) Regulations 2006 apply when a business or part of
one is transferred to a new employer or where a contractor takes on a contract to provide a service for a
client from another contractor. This should be distinguished from an asset only sale where no employees
would transfer.

The Regulations first came into force in 1981 and implemented the European Communities Acquired Rights
Directive (ARD) (prior to the TUPE Regulations 1981, the ARD only had direct applicability to public bodies).

The effect of the Regulations is to preserve a then current employee’s terms and conditions. Further the
buyer inherits all rights and liabilities and obligations arising from those contracts of employment.
Therefore any acts or omissions of the seller before the transfer are treated as having been done by the
buyer. For this reason it is critical, that the buyer obtains appropriate indemnities from the seller in respect
of all pre-transfer liabilities. Martin v Lancashire County Council and Bernadone v Pall Mall Services Group
[2000] WL 571232 confirm that in addition to the transfer of liability in tort for personal injury, the seller’s
right of indemnity under its employer’s liability insurance also transfers to the buyer. The question therefore
arises as to who is the correct Defendant to be sued, the buyer or the seller? Both cases confirm that the
buyer is the correct Defendant to be sued.

The difficulty in disease litigation (particularly long tail diseases) is that employment often ceased many years
ago. If the alleged employer still exists it is rare for them to have retained documentary proof of the
Claimant’s employment dating back many years. The Claimant’s National Insurance Employment History
(which the Claimant’s Solicitor should have obtained from HMRC) should be considered in light of Companies
House records and searches in order to confirm employment (unless the Claimant has any old wage slips or
other proof).

It is wise to consider the Claimant’s letter of claim, medical report and witness statement if available in detail.
The Claimant should explain all of his relevant employers where excessive exposure is alleged and whether or
not his employment was continuous between any such employers and appropriate questions raised, if this
information is not provided. If a Claimant left Employer A and started working for Employer B carrying out
the same job as before and providing the transfer took place post 1 January 1981 then the TUPE Regulations
1981 (or 2006 if post 6 April 2006) will apply.

Claimant’s Solicitors will often ask for sight of the copy contract confirming the TUPE transfer, but this will
often be unavailable due to the passage of time and frankly should be not be necessary given the above.
Claimants will recall whether or not they gave their notice or were dismissed prior to obtaining a new job on
their own merit; as opposed to simply being moved from employer A to Employer B and continuing as before.
As a result Claimants are the best people to answer whether or not there has been a TUPE transfer; providing
their Solicitor is familiar with TUPE Regulations and case law.

Claimant’s Solicitors regularly seem to forget that it is solely the Claimant’s duty (or arguably the Claimant’s
Solicitors duty) to identify the correct Defendant in any Court Proceedings they choose to issue. If a mistake
is made and the incorrect Defendant is pursued, then upon discontinuance or Summary Judgment that
Defendant should seek its costs from the Claimant. If the Claimant has BTE or ATE insurance funding those
insurers may have to meet the Defendant’s costs. However, more often than not this will be a legal error by
the Claimant’s Solicitors- and consequently should be personally liable to pay the Defendant costs on the
Claimant’s behalf.

If a Claimant alleging industrial deafness / noise induced hearing loss worked for Company A as a road
worker whilst they had the contract for repairing a Local Authority’s roads and he subsequently transferred to
Company B in 1982 (when they secured the road work services contract), then Company B would be the
correct legal Defendant. Company B would remain the correct legal Defendant even if the Claimant did not
allege excessive noise exposure with them, for instance if Company B immediately introduced adequate
hearing protection to reduce the noise level. In the co-joined Court of Appeal cases of Martin and Bernadone
(see above) LJ Peter Gibson confirmed that there can be no doubt that upon a TUPE transfer; a liability which
is transferred, ceases to be enforceable against the seller (upholding the decision in Allan v Stirling DC [1995]
ICR 1082). As such to sue Company A in our scenario above would be incorrect and would entitle Company A
to a discontinuance or Summary Judgment.

Claimants frequently mistake similar named Companies for each other. A Solicitor on the Claimant’s behalf
may attempt to argue that these Companies are “one and the same”, particularly if they are within the same
Group of Companies, and that the action should be allowed to proceed. The House of Lords case of Salomon
v Salomon & Co [1897] AC 22 established that a Company has its own legal personality distinct from its
shareholders/owners and thus a Court cannot make such a leap between two distinct legal entities. This was
applied in JH Rayner Ltd v DTI [1990] AC 418 and the fairly recent case of Carlton & Granada v The Football
League [2002] EWHC 1650.

In reality all of the insurers for a period of employment may decide not to take issue with such an inaccuracy
by the Claimant. This may be the case where all of the insurers want a swift economic settlement or want to
avoid the expense of a Claimant restoring a dissolved Company to the Register of Companies. Conceding
such a point should only be considered where there is a full insurance history and where all of the insurers
are in agreement. The danger otherwise is that other contributing insurers may subsequently disagree with
that decision and refuse to contribute.

In their simplest form, the TUPE Regulations are relatively straightforward. However, care should be taken by
the buyer of a new business, involving the transfer of employees, to ensure that wherever possible due
diligence is undertaken to ensure that details of all insurance policies (from time to time in force) are
provided. In the absence of those policies, an indemnity should be obtained from the seller, as it is the
current employer against whom proceedings will be issued and liability sought.

Lisa Watson, Associate Solicitor and Russell Daw, Associate Solicitor, Weightmans LLP
Disease - January 2010
Provisional Damages – Familiarity Breeding Contempt?

Asbestos specialists face claims for provisional damages on a daily basis. Claimants generally seek standard
return conditions which pivot around four deteriorations or future risks which have become accepted as
arising from asbestos exposure. Drafting Particulars of Claim has become almost a pro-forma exercise. It
may have become commonplace to some Defendant practitioners to draft standard Defences and to agree
terms of Consent Orders without a second glance, but by mirroring the Claimants’ complacency, it seems the
purpose of provisional damages has been lost along the way. Let us remind ourselves of the law relating to
provisional damages, the circumstances in which they can be claimed and the importance of ensuring
appropriate return conditions.

Section 51 County Courts Act 1981 and Sections 32A and 34A Supreme Courts Act 1981 enshrine the Court’s
discretionary power to award provisional damages in circumstances where there is a chance that at some time
in the future the injured person will, as a result of the act or omission giving rise to the cause of action,
develop some serious disease or suffer some serious deterioration in his physical or mental condition. This
allows the Court to award the injured person:

    a)         Damages assessed on the assumption that the injured person will not develop the disease or
               suffer the deterioration in his condition; and
    b)         Further damages if at a future date he develops the disease or suffers the deterioration.

The Court cannot impose a provisional award upon a Claimant. It is entirely a matter for the Claimant as to
whether he wishes to opt for a provisional award. Cowan v Kitsons Insulation [1992] PIQR 019.

Claimant and Defence practitioners alike are sometimes ignorant of the fact that a default judgment cannot
be obtained in a provisional damages claim unless the Claimant abandons his claim for provisional damages.
In such circumstances, the Claimant should apply for directions in accordance with Part 23 CPR.

Rules 41.2 and 41.3 CPR 1998 set out the practical framework for provisional damages claims. The Practice
Direction to Part 41 fleshes out exactly what the provisional damages Order should contain and the
documents which must be preserved as the case file in the event of a return claim. The Order must:

    Specify the disease or type of deterioration which will entitle the Claimant to apply for further damages if
    they occur at a future date;
    Give an award of immediate damages;
    Specify the period in which an application for further damages may be made; and
    Direct what documents are to be filed and preserved as the case file in support of any application for
    further damages.

As complacency sets in, the boundaries as to what constitutes a “serious deterioration” become blurred. In
Willson v MOD [1991] 1 All ER 638 Scott Baker LJ stated it was necessary to consider:

    a)   Whether it was proved there is a chance of some serious deterioration in the Claimant’s condition,
    b)   Whether the Court should exercise its discretion in favour of the Claimant in the circumstances of the

He clarified that the “chance” must be measurable rather than fanciful. To satisfy this, we see the
measurement of future risks by medical experts in percentage terms in medical reports in asbestos claims.
Scott Baker LJ offered the guidance that a “serious deterioration” means something beyond ordinary
deterioration. Taken to its limit, there is scope for the proposition that low level asbestosis or pleural
thickening sufferers with minimal future risks of progression should not be permitted to return to Court for
further damages in case of deterioration of those conditions. How can such deterioration be viewed as
beyond ordinary deterioration? Weightmans have recently, successfully limited return conditions solely to
asbestos related lung cancer and mesothelioma in just these circumstances. In doing so, it was necessary to
remind the Claimant and the Court of the rationale behind provisional damages and of the meaning of
“serious deterioration”.

Caution should be exercised when setting time limits for return claims. It is becoming increasingly common
for Claimant’s solicitors to seek to reserve rights for the Claimant’s Estate in the event of death. The Court
has no power to grant a declaration reserving rights to an Estate. The Law Reform (Miscellaneous Provisions)
Act 1934 and the Fatal Accidents Act 1976 enshrine the rights of the Deceased’s Estate to bring such a claim.
Such rights do not need to be rehearsed in any order for provisional damages.

The practical effect of going back to basics with these principles can only benefit Defendants and Insurers
alike. By limiting return claims only to malignant diseases provides greater certainty in terms of future
reserves. The possibility of two bites of the cherry, for example worsening asbestosis and then developing
lung cancer, is removed. The costs benefits of avoiding such multiple return claims are evident.

Whilst provisional damages claims are seen as fast track money spinners to Claimants, the reality for
Defendants is that they cannot be looked on with scorn. Casting your eye to the future now when assessing
appropriate return conditions can avoid any unintended consequences that over-familiarity with provisional
damages may bring.

Victoria Douglas, Associate Solicitor, Weightmans LLP
Disease - January 2010
Pension Loss Calculations in Disease Claims

In May 2007 the 6th edition of “The Ogden Tables” was published which fundamentally altered the
methodology for the calculation of future loss of earnings. The impact upon pension loss claims was far more
subtle and consisted only of alterations to the multipliers to be adopted when calculating the same. This was
due to a revision of life expectancy in the population as a whole following predictions based upon the
findings of the 2004 National Census. Ogden 6 confirms “increased multipliers with most effect on
multipliers at younger ages for loss of pension”.

In fact the increase in the multipliers for, say a male with a pension loss commencing at age 65 years ranges
from 11.82% (for a male aged 40 years at the date of trial) falling to 2.4% (for a male aged 50 at date of trial)
and thereafter to nil by age 65.

We are all probably quite familiar with calculating loss of pension in the context of “lost year claims” and
claims for dependency in Fatal Accident Act matters and as such these present few practical difficulties.

What are encountered less frequently are those situations where an individual loses pension rights during
their working life and it is upon these situations which this article intends to shed some light.

At its simplest is the situation where a person suffers a reduction in future likely pension payments, either
due to loss of the pensionable employment or because their contributions to the scheme are reduced due to
a reduction in earnings caused by the Defendant’s breach of duty, but where the Claimant concerned does
not receive any ill health early retirement pension.

Most pensions have 2 components; firstly the possibility of drawing down part of the “fund” upon retirement
as tax free cash (typically up to 25% of the fund) with a corresponding abatement of the annual payments;
secondly an annual payment (paid monthly or weekly) for the life of the scheme member. There might also be
a widow’s pension and death in service benefits. It is important to remember that tax is payable on annual
pension receipts although whether this will impact on actual receipts will depend upon the Claimant’s total
annual income and age ( as personal allowances increase with age).

In this scenario the loss calculation is reasonably straightforward. Once the pension scheme administrators
have confirmed the lump sum and annual pension which the claimant would have enjoyed but for the
accident and that which he is now likely to receive the calculations can commence.

The Claimant will receive the difference between the lump sum which he would have received but for the
Defendant’s breach of duty and that which he will now receive at retirement. This must be reduced to reflect
accelerated receipt using Table 27. This takes account of the fact that a claimant could invest the monies
awarded to him with an assumed rate of return of 2.5% per annum. For example, the discounting factor for
10 years at 2.5% pa return is 0.7812.

The annual loss is then multiplied by the appropriate multiplier to calculate the lifetime loss of annual
pension payments and that, added to the lump sum is the pension loss.
Thus for example a 40 year old claimant would have retired at age 65 with a lump sum of £20,000 and an
annual pension of £7,500. He will now receive a lump sum of £10,000 and an annual pension of £4,000.

His lump sum loss is £10,000, which must be reduced by a discounting factor of 0.5394 to reflect 25 years
accelerated receipt. His loss is £10,000 x 0.5394 = £5,394.

In addition, his annual loss is £3500. The multiplier is set out in Table 21 and is 7.78 years. Thus £3,500 x
7.78 = £27,230. His total pension loss is therefore £5,394 + £27,230, a total of £32,624.00.

More complex are those cases where the Claimant is a member of a pension scheme which provides ill health
early retirement/ disability pensions. Parry v Cleaver [1970] AC 1 decided that the ill health pension
payments received by the claimant prior to his normal retirement date cannot be set off against any loss of
wages claim. After his “normal” retirement date (ie the date upon which he would have retired if he had not
been injured) then the receipts can be set off against the annual payments that the Claimant ought to have
received, to create a net loss figure to be multiplied by the relevant multiplier as set out above.

The complexity arises in the treatment of any lump sum paid to the Claimant early. Typically, these schemes
allow a claimant to retire immediately, generally with an enhancement of actual years served. The claimant
can elect to take part of his fund by way of lump sum immediately (with a corresponding reduction in annual
pension payments). Although the pre retirement annual payments cannot be deducted from the pension loss
claim, part of the lump sum can.

The methodology for calculating the same was set out in the case of Longden v British Coal Corporation
[1997] UKHL 52. In order to determine the amount of the lump sum, received early which can be set off
against the pension claim one must calculate the multipliers for the claimant to his normal retirement age
and for his full life (ignoring any reduction in life expectancy arising as a result of the Defendant’s breach of
duty). The difference between these 2 multipliers represents the post retirement multiplier. The post
retirement multiplier is divided by the full life multiplier and multiplied by 100 to calculate the % deduction.
Additionally, in order to compare like with like the retirement lump sum must be ascribed a current day value,
by reducing it to reflect accelerated receipt using Table 27.

Thus a claimant retires aged 40 years and receives a lump sum of £10,000. But for the accident he would
have retired at aged 65 and received £20,000. He now receives an ill health pension of £4,000 and will
receive a retirement pension of £7,500 at age 65.

Discount factor for accelerated receipt of lump sum (25 years, 2.5%, Table 27) 0.5394

Present value of expected lump sum is £20,000 x 0.5394 = £10,788

Life multiplier at receipt of lump sum           25.79
Multiplier to retirement at receipt of lump sum 18.01

“Longden” factor (25.79 – 18.01) / 25.79 = 0.3017

Lump sum loss is £10788 – ( £10,000 x 0.3017) = £7,771
Therefore present value of the lump sum loss is 7771 x 0.5394 = £4,191.68

Annual pension loss is £3500
Pension multiplier is life multiplier – multiplier to retirement
Ie 25.79 – 18.01 = 7.78 (as previous calculation)
Total annual loss is £3,500 x 7.78 = £27,230

Total pension loss is £27,230 + £4,191.68 = £31,421.68

Thankfully, the incidence of claims involving these sorts of calculations in disease claims is low and likely to
decrease as expensive final salary pension schemes are closed to new entrants and phased out by overhead
conscious employers. The corollary of the lack of practise in dealing with these may well be a certain amount
of head scratching particularly where a claim is badly pleaded by a Claimant.

Paul Debney, Partner, Weightmans LLP
Disease - January 2010
Third Parties (Rights against Insurers) Bill

Some 11 years after the Law Commission Report was published which recommended material changes to the
existing Third Parties (Rights Against Insurers) Act 1930, it appears that there are more realistic prospects of
a new Bill receiving Royal Assent after a second Reading Committee took place on 7 and 9 December 2009.

The 1930 Act

This Act aimed to regulate the position where a Third Party could not proceed against another on the grounds
that the individual or the Company had become insolvent. The 1930 Act transferred the Insured’s right under
the insurance policy to the Third Party and enabled them in certain circumstances to proceed directly against
the insurer.

In practice several problems emerged, particularly as the Courts tended to adopt a restrictive approach to its

Amongst other things the Act required:

           The Third Party to establish the existence and amount of the Insured’s liability before proceedings
           could be issued;

           The Third Party was required to proceed against both the Insured and the Insurer and for example in
           historical disease claims required the restoration of the “Insured Company” to the Companies
           Register to enable it to be sued.

           Any rights transferred could be subject to any defences which the Insurer could have used against
           the insured, e.g. failing to notify the insurer of the claim even if the Third Party provided that

The considered view of the consultation was that the existing legislation was in many circumstances time
consuming and costly.

The Bill

Although this has yet to receive Royal Assent and consequently is open to amendments, it appears that the
main thrust will be radical

           A Third Party who is able to establish the existence of insurance will now have no obligation to join
           the Company in proceedings – i.e. obviating the need for the Claimant to restore the former Company
           to the Companies Register.

           It seeks to restrict the technical defences available to insurers, e.g. treating the notification clause as
           being satisfied if the Third Party has provided the notification. Additionally, any policy condition
           requiring the insured to provide ongoing information to the insurer should have no effect if the
           insured is now dissolved
        The Third Party has a right to seek Declarations as to the Insured’s liability to them and the Insurers
        potential liability (under the contract of insurance) in one set of proceedings which will enable the
        Claimant to obtain a monetary judgment.


This Bill if enacted will not materially change the position for insurers and those acting for Defendants in
personal injury proceedings save that the new streamlined process ought to provide reasonably substantial
savings as this now obviates the Companies requirement for dissolved companies to be formally restored to

James Michael Byard, Partner, Weightmans LLP
Disease - January 2010

When does time start to run?

Axa insurance Ltd (Formerly Winterthur Swiss Insurance Co) v Akther & Darby Solicitors & Ors (2009).
This case concerned the appeal against the decision that claims against the Defendant Solicitors were statute
barred. Axa were the assignees of an insurer that provided after the event legal expense insurance under a
scheme run by a claims management company. Part of the role of the Defendant Solicitors to this action
under the scheme was to vet the potential claims. The scheme operated required that a claim had to have
prospects of success of at least 51%. The ATE insurer would then issue a policy of insurance. It was claimed
that the Defendant Solicitors had been negligent in vetting the claims, in the conduct of litigation on behalf of
the claims pursued and/or in failing to notify the ATE insurer when the prospects of success fell below the
required levels. Limitation was heard as a preliminary issue. The Claimant claimed that time only began to run
in the case of both vetting and conduct breaches at the time when a claim could have been made under the
policy and that the ATE insurer's liability was no more than an unsecured contingent liability until that
occurred. At first instance the Judge decided that the time under the Limitation Act started to run for the
claims as to negligent vetting at the time of the inception of the policies, so that claims in respect of policies
which were incepted more than six years before the issue of proceedings were statute barred. In the case of
the alleged negligent conduct, the claims were statute barred where the relevant failure to notify occurred
more than six years before the issue of proceedings, or where as a consequence of a breach of duty there had
been a material diminution in the prospects of success before that date. The Court of appeal upheld that
decision. The ATE insurer was held to have an insurance policy that would in due course generate claims that
exceeded the policy; it was therefore a flawed transaction not a case of purely contingent liability. The Court
considered that there was measurable relevant loss at the inception of the policies in that any valuation would
have to take account of the assumed fact that there had been no proper vetting. As such it was correct to
treat the ATE insurer as incurring loss and therefore suffering damage as soon as the policy was issued.
Similarly where the Defendant Solicitor failed to notify or had failed to progress the case, damage occurred
when the conduct breach took place.

Did the Defendant’s admission of liability prevent a limitation Defence?

Davie v RWE Npower Plc (2009).
This case relates to an unreported Newport County Court decision. The Claimant brought a claim for noise
induced hearing loss. The Claimant had worked at a power station between 1973 to 1999. The Claimant
accepted hearing protection was provided by 1988. The Claimant underwent audiometric testing at work in
the 1980s when he was told there was nothing wrong with his hearing and again in the 1990s when he was
told that his hearing was "to be expected of a man of [his] age and the time [he had] spent in the industry".
The Claimant's case was that he thought he was being told his hearing was alright. However the Claimant also
gave evidence that he experienced temporary hearing problems from 1974 onwards and by the 1980s had
a permanent hearing problem. Despite that the Claimant took no steps to obtain advice or seek expert
opinion. The Claimant accepted that he had commenced a claim due to receiving a leaflet in 2006 promising
a 'no win, no fee' legal service. The Claimant accepted that he knew that noise was a possible cause of his
symptoms as soon as they started and that he had no new information in 2006 when he received the leaflet.
Shortly before proceedings were issued the Defendant had admitted breach of duty up to 1980 when they
contended hearing protection had been introduced. The Court gave judgment for the Defendant. It was held
that the Claimant had knowledge that he had sustained a significant injury by 1988 at the latest, when he
knew that he had a significant hearing impairment and his hearing loss and tinnitus had moved from a
temporary problem to a permanent problem. The Claimant had accepted that he knew his hearing problems
were attributable to his noise exposure. The Claimant's claim was therefore held to be out of time. The Court
declined to apply discretion. The Claimant had brought his claim 18 years after the cause of action had
arisen. the claim had not been issued until 18 months after the letter of claim. There was no good reason for
the delay and the Claimant had accepted he had only brought his claim due to the leaflet offering a 'no win,
no fee' service. The Court considered the Defendant would be prejudiced in investigating the claim and there
had been no criticism of the Defendant's conduct after the cause of action arose. Whilst the admission of
liability was noted, this did not prevent a limitation Defence, as per Cain v Francis [2008] EWCA Civ 1451. It
was abundantly clear to the Court that the admission was made without any investigation for commercial
reasons alone.

What delay is relevant for the purposes of Section 33 (a) and Section 33 (b) discretion?

McDonnell & Anor v David Walker (Executor of the Estate of Richard Walker, Deceased) [2009].
The Claimants had brought a personal injury claim in this road traffic matter, where liability was not in
dispute, within the normal three year period. The Claimant served proceedings one day late. At the time the
law was that the Court could not exercise it's discretion, under section.33 of the Limitation Act 1980, in a
claim where the Claimant had issued proceedings in time and then sought to bring a second action. The law
subsequently changed and the Claimant sought to bring a second action some 22 months later, in which an
application was made seeking the Court's discretion. The second claim brought sought to substantially
change the pleaded case and included additional claims for loss of earnings and psychological injury. At first
instance the Claimant was successful in seeking discretion. On appeal the Court held that the relevant delay
to be considered under s.33(a) and s.33(b) was not only the delay since expiry of the limitation period but
also the overall delay. The Court considered that where there was forensic prejudice given the second claim,
received some 7 years after the initial accident, was of a different magnitude to the originally pleaded claim,
the Court then had to consider the cause of the delay. If the delay was excusable and it was still possible to
have a fair trial then it might be just and fair to allow the trial to proceed, on the other hand if the delay had
caused unfairness to the Defendant in his ability to investigate the claim and there was no excuse for the
delay, the action should not be allowed to proceed. In this case, the Court of Appeal concluded that the
Defendant would be forensically disadvantaged and there was an inexcusable delay, especially where the
Claimant had the possibility of pursuing his solicitors for making the error in service of the first set of
proceedings and as such the appeal was allowed.

Peter Ward, Solicitor, Weightmans LLP
Disease – January 2010
Trends and Wider issues

Noise induced claim from a cellist
A Dutch Appeal Court held that a Dutch orchestra failed to take sufficient steps to protect a cellist playing in
the orchestra over a period of 31 years between 1974 and 2005, from exposure to excessive noise. The
orchestra was ordered to pay compensation to the cellist for her noise induced hearing loss.

The Jackson reforms
Very briefly, the main proposals made by Lord Justice Jackson to cut the cost of litigation are:

    Success fees and after the event (ATE) insurance premiums should no longer be recoverable from losing
    One way costs shifting in that successful Defendants will not be able to recover their costs in personal
    injury, clinical negligence and defamation cases unless they can show that the Claimant has acted
    Referral fees for PI cases should be ended.
    Contingency fees should be limited to 25 % of a Claimant’s damages.
    General damages should be increased by 10 % (to allow for the reduction in their damages for the success
    Fixed fees for personal injury fast track cases.
    The Claimant’s damages to be enhanced by 10 % where a Defendant rejects a Claimant’s Part 36 offer
    and fails to do better at trial.

IPOD – Music Player – Class Action
A class action in America by Plaintiffs against Apple for possibly causing hearing loss to those using Apple
IPOD music players was rejected. Upholding an earlier decision that it had not been shown that there was an
unreasonable risk of noise induced hearing loss in using the IPOD, the lawsuit against Apple was rejected by
the Federal Appeals Court.

The Plaintiffs who proposed changes to make IPOD’s safer had only pleaded a potential risk of hearing loss to
other unidentified users.

Link between bowel cancer and eating processed meat
It is reported that the World Cancer Research Fund (WCRF) are advising parents to refrain from filling
children’s sandwiches with ham and other types of processed meat. They are concerned that children will
increase their risk of developing cancer later in life if they get into the habit of eating such food in early life.
The reason for the warning is the scientific evidence from research on adults which shows eating processed
meat increases bowel cancer risk.

It has been estimated in the UK that bowel cancer cases could be reduced by nearly 4,000 if everyone ate less
than 70 g of processed meat a week. The WCRF claim that the scientific evidence of the link is convincing
and propose alternative sandwich fillings of poultry or fish, low fat cheese, houmous or small amounts of lean
Risk of lung disease due to exposure to nanoparticles
In our July 2008 e bulletin we reported on the publicity of nanotube risks surrounding warnings following
joint UK/US research undertaken.

It has recently been reported that females working in a factory in China where nanoparticles were used in
paint have developed serious lung disease, with two being fatally injured.

According to a study published in the European Respiratory Journal there is clear evidence that nanoparticles
can be hazardous to health as nanoparticles were found in the Chinese women who were taken ill.

In the study of 7 young female workers where nanoparticles were present in the workplace and where the
workers were exposed over a period of 5 to 13 months and developed respiratory symptoms,
transmission electron microscopy showed nanoparticles lodged in the cytoplasm and caryoplasm of
pulmonary epithelial and mesothelial cells and also located in the chest fluid. There is a concern that in the
absence of protective measures, exposure to some nanoparticles may be associated with serious lung

Gloria Ginvert, Partner, Weightmans LLP