Covering Disease costs NIHL and pre-action disclosure date. Part 36 offers in multi-defendant cases and quantum in mesothelioma claims

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1 This is the first of our revamped monthly updates with its focus on disease issues. The aim is to provide a quick snapshot of topical issues and recent cases for the busy Disease Practitioner. We always enjoy hearing from our readers, so if you have any suggestions for topics or experiences to share, please us at The market place Exploring No slow down in disease claims, EL disease portal update Mesothelioma update no new protocol and fixed fees for the time being but success fees will go. Case law update Covering Disease costs NIHL and pre-action disclosure date. Part 36 offers in multi-defendant cases and quantum in mesothelioma claims On the horizon Looking at IEG v Zurich and McDonald v Department for Communities and Local Government and National Grid Electricity Transmission Plc

2 The market place No slow down in disease claims The unprecedented levels of new NIHL claims seen in 2013 may have shown some signs over the last few months that the peak was reached in September/October However, those hoping for a return to 2012 levels of new claims may have to wait a little longer, as all indications are that disease claims will still remain attractive to claimant firms in the post Jackson world larger claimant firms and legal services providers are actively recruiting handlers at all levels. New organisations including those who previously dealt with volume road traffic accident claims are turning to the disease and clinical negligence market. In the coming months, it is anticipated that claimant firms will continue to diversify their marketing strategies and increase their use of social media. The Insurance Times has already picked up on this and recently reported that the Pro-legal Solicitors Face book Industrial Deafness Lawyer page has received more than 3,300 likes since its launch. EL disease portal p update it s not working! Five months after its introduction, nearly 2,700 disease claims have been notified through the Portal, though our own research suggests that in relation to NIHL claims, this is less than 5% of the total received during the same period. Clearly, claimant solicitors are adopting a sophisticated filter system to turn down the majority of single Defendant claims! The number of cases settled so far is miniscule only 3 of the 2,700 claims with the majority of claims falling out. We believe there is an urgent need to amend the existing protocol to ensure that more cases are being captured. Even if new NIHL claims for 2014 are only half of last year s figure, this would still mean that potentially thousands ought to be captured and be capable of being retained within the process. We suggest a 2 step approach either by the simple additions of a mandatory requirement for the inland revenue schedule, medical report, claims declaration form, but in the long term, there must be scope to adapt this to multi-defendant cases. Mesothelioma update no new protocol and fixed fees for the time being but success fees will go The Government has announced that mesothelioma claims will be subject to Section 44 and 46 of LASPO. Those sections concerned the ending of recoverability of success fees and ATE premiums. They will apply to mesothelioma cases from July The Mesothelioma Act received Royal Assent on 30 January It is anticipated that the Diffuse Mesothelioma Payment Scheme will be operational by mid The Government has however declined to take forward the proposal for a Mesothelioma Pre-Action Protocol supported by a fixed recoverable costs regime. 2

3 Recovery of costs in asbestos related conditions The Welsh Government s legislative competence to pass the Medical Costs Bill for asbestos related conditions is to be determined by the Supreme Court. The Hearing is likely to be in May 2014 and will determine whether the Welsh Government can recover from insurers the medical costs incurred by the Welsh Government in treating those with asbestos related conditions. Case law update Disease costs negotiate before premature issue or face the consequences Knowles v Goldborn (t/a Mercian Marble) [2014] Here the defendant appealed against the decision to refuse its application to strike out Part 8 costs only proceedings brought against in by the claimant. The claimant brought in a personal injury action against the defendant which settled before proceedings were issued with the defendant agreeing to pay the claimant s damages plus reasonable costs. Whilst the claimant sent the defendant a Bill of Costs and the latter indicated they intended to make an offer, they requested names, qualification and experience of the fee earner s involved so they could be verified. The claimant s response was that the points raised did not justify any failure to make an offer and stated that proceedings would be commenced unless an offer was made. An offer subsequently made by the defendant was not responded to and the claimant issued Part 8 proceedings, three weeks after service of the Bill of Costs. The defendants sought to strike out the proceedings on the basis that as the claimant had not attempted to agree the amount of costs and therefore the condition set out in CPR Rule that the parties must have failed to agree the amount of costs had not been satisfied. However at first instance, the application was refused and the defendant subsequently appealed that decision. On appeal, the court held that where a party issued Part 8 costs only proceedings without having made a proper attempt to agree the amount of the costs, the condition for issuing proceedings had not been satisfied. Such proceedings were to be struck out as premature. The court reiterated that the parties should seek to negotiate settlement and not rush to litigation. The rules have made it quite plain that costs only litigation was to be pursued where agreement had not been reached. Comment A reminder that the premature issue of proceedings, risks being penalised in costs. The individual circumstances of the case will largely dictate the decision and here it was clearly fundamental that the defendant sought both clarification and made an offer which provoked no response. 3

4 NIHL and pre-action disclosure d No need for claimant to establish causation in a formal medical report before disclosure date. Smith v Secretary of State for Energy & Climate Change [2013] The applicant had been employed for 30 years by the National Coal Board. He alleged that he had suffered NIHL caused by exposure to excessive noise levels without the provision of hearing protection. He requested disclosure of documents to include noise surveys, hearing conservation policies and health and safety meeting minutes regarding noise and hearing protection. The respondent declined to provide the pre-action disclosure voluntarily, contending that without either a medical report or a screening audiogram, the claimant could not establish he had an arguable case. The claimant issued a PAD application which was initially granted, but refused on appeal. The claimant subsequently appealed to the Court of Appeal. A Court of Appeal held that CPR requires a two stage approach to be adopted. 1 To establish that the jurisdictional threshold is satisfied and; 2 Whether as a matter of discretion an order for disclosure should be made. It was held that the jurisdictional threshold did not require the claimant to establish even an arguable or prima facie case and that there was no requirement that the claim was likely to be made. The Court of Appeal ruled that whilst NIHL was different from a physical injury in that an expert opinion was needed to demonstrate both abnormal hearing loss had occurred and was noise induced, it would be contrary to the policy of pre-action disclosure provisions to require the claimant to go to the expense of obtaining a medical opinion first. Comment A decision which establishes there is no requirement for a claimant to provide evidence of causation before he is entitled to see the defendant s disclosure. Practitioners should however be mindful of the wider strategy on PADs and ordinarily a respondent should not be liable to pay the claimant s costs in line with a decision of Bermuda International v KPMG Part 36 offers in multi-defendant cases common costs can be apportioned where co-defenda efendants nts are ultimately not pursued Haynes v Department for Business Innovation and Skills [2013] The claimant was a widow who claimed against ten defendants for her husband s asbestos related lung cancer. The claimant made individual Part 36 offers against several defendants but served proceedings on the named defendant only. The defendant accepted the claimant s Part 36 offer. The claims against the other defendants were abandoned and the claimant lodged her bill of costs. The claimant s case was that under Part 36.10, she was entitled to claim all costs incurred subject to a detailed assessment, whereby the only costs not recoverable were those unreasonably incurred or for an unreasonable amount. The defendant s case was that as this a multi-defendant divisible claim, they were only liable for those costs that were directly attributable to the claim against it and that common costs should be apportioned. As there were ten defendants, the apportioned share should be 10 %. The court held that the defendant was only liable for those costs solely attributable to the claim against it and that common costs should be apportioned and that the appropriate share should be 10%. The court did not consider the claimant s approach had satisfied proportionality. 4

5 Comment A very important costs decision which will speed up handling in multi-defendant divisible disease cases. Prior to this decision, practitioners were often prevented from making offers in multi-defendant cases for fear of being landed with all generic costs and disbursements if the claimant chose to discontinue against others. Quantum in mesothelioma claims Haxton v Philips Electronic [2014] In this case both Mr and Mrs Haxton had contracted mesothelioma. Mr Haxton was exposed to asbestos whilst employed by the Defendant and his wife when she washed her husband s clothing. Mrs Haxton claimed as widow and administratrix of her husband s estate and proceedings were settled by consent with damages for loss of dependency based on her remaining life expectancy of only 0.7 years. Mrs Haxton then issued proceedings in her own right for damages for negligence and breach of statutory duty, seeking to recover the loss of her dependency that she would have recovered in the first claim, were it not for the defendant s negligence which caused her mesothelioma. The Court of Appeal held that there was no reason in principle or policy which deprived a claimant in this situation from recovering damages which represented a loss she had in fact suffered as a result of the reduction in her own life expectancy caused by the defendant s negligently exposing her to asbestos. There was no reason why the diminution in the value of that right resulted from the defendant s negligence and could not be recovered as a head of loss in her personal action. Comment An unusual and unfortunate case which allows a claimant to recover for the diminution in the value of her own claim caused by the defendant s negligence. On the horizon IEG v Zurich A fixed date has now been set for the hearing of Zurich s appeal the 15 th and 16 th of July 2014 with judgment anticipated in September/October. It will be hoped that the issue of contributions made by part insured policyholders will be resolved by this Judgment. McDonald v Department for Communities munities and Local Government and National Grid Electricity Transmission Plc. The Supreme Court heard oral submissions on the 12th and 13th of February The case concerns the interpretation of the 1931 Asbestos Regulations to factories not engaged in the manufacture of asbestos products, but making lagging paste for insulation in a power station. There is also a cross appeal as to whether the appellant was in breach of a statutory duty owed to the respondent under Section 47 of the Factories Act [1937] as it was claimed there had been a substantial quantity of dust present on his visit to the premises. 5

6 Further information about Weightmans LLP or to discuss any of the issues in this newsletter,, please contact: Jim Byard, Partner via or Judith Peters, Consultant via or Joanna Hector, Solicitor via or Weightmans LLP February 2014 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. This update is not intended to constitute legal advice and should not be treated as a substitute for legal advice. Weightmans accepts no responsibility for any loss, which may arise from reliance on the information in this update. The copyright in this update is owned by Weightmans 2013 Data Protection Act Pursuant to the Data Protection Act 1998, your name may be retained on our marketing database. The database enables us to select contacts to receive a variety of marketing materials including our legal update service, newsletters and invites to seminars and events. It details your name, address, telephone, fax, , website, mailing requirements and other comments if any. Please ensure you update our marketing team with any changes. You have the right to correct any data that relates to you. You should contact James Holman, our Data Protection Officer in writing, at 100 Old Hall Street Liverpool L3 9QJ. 6

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