Court of Session upholds Scottish Pleural Plaques Damages Law - 15.01.10
The Court of Session has rejected a challenge by four UK insurance companies to overturn Scottish asbestos legislation that gives individuals diagnosed with pleural plaques a right to claim compensation. The Damages (Asbestos-related Conditions) (Scotland) Act 2009 makes pleural plaques a compensatable condition in Scotland.
The Act effectively overturns in Scotland the House of Lords ruling in Rothwell v Chemical & Insulating Co Ltd 2008 1 AC 281 that asymptomatic pleural plaques do not give rise to a cause of action because they do not signify damage or injury that is sufficiently material to found a claim for damages against an employer. Although the Rothwell decision was not legally binding in Scotland, it was “highly persuasive”. The passing of the legislation has created conflicting positions north and south of the border.
The insurers challenged the lawfulness of this Act of the Scottish Parliament. They argued that the legislation unfairly burdens them with additional liabilities under indemnity insurance policies running into millions, if not billions, of pounds and that it will open the floodgates to similar controversial damage claims.
Following a 22-day hearing, Lord Emslie ruled against the challenge. He did not accept that the insurers’ complaints came anywhere near the standard of “irrationality” needed to invalidate an Act of the Scottish Parliament. He considered that the legislation “would require to be tainted to a serious degree before an application such as the present could be upheld”. Lord Emslie’s opinion concluded that “there is clearly room for differences of opinion as to whether the 2009 Act will prove to have adverse legal or political consequences in years to come.” However, as a matter of law, the challenge failed.
The legislation, which is retrospective, will continue to allow those with pleural plaques and other similar asbestos-related conditions to make compensation claims at the expense of insurers north of the border. The UK Government has now been called upon to enact similar legislation for England and Wales.
An appeal has now been lodged against the ruling.
Links to the full judgment and legislation can be found at:-
http://www.scotcourts.gov.uk/opinions/2010CSOH02.html
http://www.opsi.gov.uk/legislation/scotland/acts2009/pdf/asp_20090004_en.pdf
Further information
For further information on this or any other insurance litigation issue, please contact Andrew Lothian or Douglas Keir or your usual contact within the Insurance Litigation team.
