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[June 23, 2006]

U.K. Lawyer Wants Public Funds Used in Asbestos Claims

(Bestwire Service Via Thomson Dialog NewsEdge) OLDWICK, N.J. (BestWire) - The U.K. government is putting a potentially unfair burden on insurers with its plan to reverse a court decision on asbestos damage, in the view of a London lawyer who specializes in such cases.


Any solution should tap into public funds, said Rod Freeman, a partner in the London office of the international law firm Lovells.

The government should recognize that the litigation system is not going to deliver justice to the victims of asbestos, Freeman said during an interview in his office.

The Labor government of Prime Minister Tony Blair is proposing a legislative change that would nullify a decision by the House of Lords, which acts as the United Kingdoms highest court. The judgment had limited the potential liability of an employer in an asbestos-related death.

The House of Lords had ruled that liability should extend to other employers that could have been the source of the mesothelioma that killed Vernon Barker, a steel worker. His widow previously had been awarded 152,000 pounds ($280,000) in damages by a lower court (BestWire, May 3, 2006).

The government intends to amend the Compensation Bill, now being considered by Parliament, to allow a claimant to pursue a single company, which would then be allowed in turn to seek damages from other employers (BestWire, June 22, 2006).

Freeman, who has insurance companies and manufacturers on his client list, supports the position of the Association of British Insurers that a fund be established that would draw contributions from insurers, the industry and the taxpayer.

Its in the interests of all concerned that there be an efficient way to deliver compensation to those that are sick and dying, he said.

Questions can be raised about a measure that seems to mandate that somebody should effectively pay for somebody elses negligence, Freeman said.

He also criticized the creation of a retrospective liability, arguing that it could create precedents in such areas as the occurrence of CJD, or mad cow disease, from contaminated meat or the transmission of HIV or hepatitis C through blood transfusions.

The Association of Personal Injury Lawyers supports the government plan to amend the Compensation Bill. Richard Langton, president of the group, said that a speedy change in the law could improve the chances for compensation of thousands of mesothelioma victims and their families.

The Law Lords dealt a devastating blow when they ruled that each of the victims past employers should only be responsible for paying a portion of the compensation awarded, Langton said in a statement.

APIL, as the group is known, will work closely with the government on the issue of compensation, Langton said, adding that APIL also wants to see improved information from insurance companies.

One of APILs particular concerns is how notoriously difficult it is for victims to actually trace their former employers, as many of them go out of business years before any disease becomes apparent, Langton said.

Freeman said that the later use of asbestos in European industry means that the issue trails the U.S. experience by about a decade in both legal and practical terms.

The pattern of illness in Europe is lagging behind the U.S., and the issue will probably hang around for longer in Europe for the same reason, he said.

This gap, Freeman suggested, has given the insurance industry particular concerns about the U.K. and Europe in terms of future asbestos liability.

There are no reliable figures on the levels of potential asbestos liability in the United Kingdom and Europe, Freeman said. But the differences in approach on this side of the Atlantic suggest there will be nothing like the numbers in the U.S., he said.

Litigation levels in the United Kingdom have not been as intense, Freeman said. Meanwhile, continental European countries tend not to assign blame, preferring to handle compensation through taxpayer-funded social security systems.

Freeman traced the current situation to the 2002 Fairchild case, in which the House of Lords declared that each of a number of employers could be held liable for asbestos exposure linked to mesothelioma. But the court failed to make clear exactly how the different employers would be forced to contribute to the damages, Freeman said.

The Barker ruling, that each employer had to pay its fair share, seems to be quite a fair result, Freeman said.

But Freeman pointed to some practical barriers to the recovery of compensation from a number of sources. We are dealing with a complicated disease that is caused by something that happened decades ago, he said. And many of the employers are long gone. Many of the insurers are long gone or the policies cant be traced.

Expensive litigation, growing out of the Barker decision, would divert more funds away from victims, Freeman suggested.

(By Robert O'Connor, London editor)

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