The outer limits

February saw insurers claiming more than a simple victory on industrial deafness claims when the verdict of Judge Inglis was handed down in Nottingham High Court. Seven test cases were dismissed in the landmark judgment, which marked the culmination of three years of legal wrangling between claimants and defendants (Post, 22 February, p1).

Insurers said at the time that they had been spared thousands of potential claims and millions of pounds in damages after claimants failed to establish that their employers were responsible for damage caused to their hearing at noise levels below 90 dBA.

Currently, the law states that where employees were employed before 1990, employers are only liable for deafness caused by noise exposure above 90 dBA. Zurich and Norwich Union were the two insurers involved in defending the cases, alongside a self-insured company and the employers being challenged were Pretty Polly, Coats Viyella and textile manufacturer Courtaulds.

Consequently, the experts at a recent roundtable were asked for their views on this verdict and what impact they believe it will have for noise-induced hearing loss claims going forward.

Rob Allen, claims manager at NU, kicked off the debate by pointing out that the cases were a challenge on the date of knowledge and drew an analogy to illustrate why he felt it was correct that the claims failed. "If you park your car outside your house where there are no yellow lines, and subsequently someone comes along and paints them there - but you didn't know they were going to - you would be a little bit aggrieved if you received a parking ticket."

He added: "It has long been established that, certainly up until 1990, the actionable limit was 90 dBA. That has been the case right back to 1963 when we had a date of knowledge for the hearing loss claims. There has been subsequent legislation that has reduced the 'safe limits' - but these cases were an attack on established law."

Perhaps unsurprisingly, Martin Bare, vice president of the Association of Personal Injury Lawyers, stepped in to disagree with Mr Allen. "The question that arose was the date of knowledge for the possibility of hearing loss damage above 85 dBA. The evidence that was led showed that one of the defendants knew from 1983 that there was a risk of injury at 85 dBA or above," he explained. "Now the concept of a 'safe limit' is a very difficult one due to people's varying susceptibility to hearing damage. But the question was, from what point should those defendants have been doing something - what was their knowledge, actual or constructive, of the possibility of a problem at 85 dBA, when the regulations at the time were at 90 dBA?"

Case in point

Robert Owen QC responded to this summation by first explaining that he represented the defendants in four of the seven cases that came before Nottingham High Court. "The generic issue raised by the claimants was to establish the proposition that exposure at the workplace - at or over 80 dBA - triggered the employers' duty of care and the need to take steps under Section 29 of the Factories Act 1961."

He also explained that the figure of 80 dBA had not simply been plucked out of the air: "It was taken from a document called the National Physics Laboratory tables, which provided estimated or predicted hearing loss at various levels, at various stages over a working lifetime from one to 50 years. The proposition was that if you go to these tables, you will see that after so many years, even at 80 dBA, an employee exposed to that level of noise would be expected to suffer some significant hearing loss albeit over many, many years."

Having detailed that this was the basis of the litigation, Mr Owen went on to explain why insurers were so intent on defending the cases. In essence, he said: "It flew in the face of the authoritative guidance given to employers since at least 1963, re-iterated in 1972 and re-iterated again in the early 1980s - at which time there was a movement to lower the threshold for action. In effect, the claimants' case was inviting the court to find that employers should have introduced a system of working that would now comply with the Control of Noise at Work Regulations 2005 but they did not come into force until April of last year, as opposed to in the 60s, 70s and 80s."

Therefore, the defendants argued that the fundamental flaw in the claimants' approach was to proceed on the basis that proof of a foreseeable risk of injury in itself triggers an employer's duty of care. "That is contrary to the law and the judge found that," commented Mr Owen. "Their second difficulty was that once you get into exposures between 80 and 85 dBA, where is the epidemiological and medical evidence to show that that kind of exposure can in fact cause significant hearing loss, or damage? We had to go into that area on a causation issue and, in all but one case, the claimants failed to establish the existence of any, or any significant, hearing damage."

Mr Owen referred to another problem that the claimants encountered. Their medical expert had accepted, in his own paper written some years ago, that exposures at or below 85 dBA are unlikely to cause anything but minimal risk and minimal damage. "And the totality of the evidence in fact supported that," he concluded.

The guests were then asked what significance this apparent lack of medical evidence at lower decibel levels would have going forward, especially considering the fact that new noise at work regulations now set the first actionable limit at 80dBA. Would it be enough to simply show that an employer had breached their duty of care by exposing employees to such noise levels, even in the absence of any hearing damage?

Mr Bare asserted: "I have never had a claimant come to me and just say 'my employer has been negligent, I want damages'. They come in and say they have been hurt, therefore they want damages. So you have to have an injury. If there is one after being exposed to levels above 80 dBA and you can prove the injury, then theoretically there is the possibility of a claim. But the extent of the noise-induced hearing loss would be a huge question of proof."

Referring to the apparent discrepancy between current medical evidence on hearing damage at certain noise levels and the new 'actionable' levels set in legislation, Neil Hackett, manager of Garwyn's disease and illness unit, commented: "You could potentially have a breach of the legislation in relation to the noise level but no actual damage to the hearing. Then we would have a technical breach, but no damage. So there is a conundrum there."

But Mr Bare confirmed: "If they are not injured, there is no case."

Compensatable damage

At this point, Mr Owen offered some extra guidance with reference to the Nottingham cases: "What the judge did say was that where a claimant wishes to bring an action in respect of alleged noise levels, resulting damage from exposures below 85 dBA, he would not by reason of those exposures alone be out of court. But he would have to establish, on the balance of probabilities, the existing compensatable damage." And in doing that, he added, the claimant would have to do more than was done in the Nottingham cases, "where effectively a doctor said 'I have heard the man's description of his working conditions, I have tested his hearing, it is not as good as I might have expected. I, therefore, make an inference that the two are connected.' The judge found that claimants will have to establish robustly the correct diagnostic criteria, and that should immediately sift out claims, leaving only those where there is some objectively viewed evidence of hearing loss."

Guests were then asked whether this meant there should not be any future industrial deafness cases, providing employers comply with the new noise at work regulations. Mr Bare replied: "Regulations now require employers to carry out hearing tests on their employees and, if complied with, then areas where there is damage will come to light. But we also have to hope that risk assessment is better going forward than it has been historically."

At this juncture, the debate turned to the issue of 'beat knee' claims. Claims for compensation in such cases essentially arise from a repetitive strain injury, caused by constant and repeated actions over a number of years. The injury that can be sustained - typically from load-bearing while kneeling and twisting or while walking over rough ground - is a form of bursitis. And there are currently a number of claims looking to be pursued by ex-coal miners.

Peter Anson, partner at DLA Piper, began the discussion by stating that beat knee is a bit of a misnomer. "Beat knee is actually bursitis of the knee, which has been a common, prescribed condition for probably 40 years. But what we are concerned with now is claims for osteo-arthritis of the knee."

Somewhat portentously he added: "If insurers are looking for the next dark cloud on the horizon, I think it is going to be common conditions like this - rather than esoteric diseases like toxic mould or brain cancers caused by mobile phones."

He then explained that the coal miners' cases in question represent the third wave of miners' disease claims, following on from those of vibration white finger and the respiratory disease claims for chronic obstructive pulmonary disease.

"COPD and VWF between them have accounted for some 770,000 claims, at a cost to the state of £7.5bn. The knee litigation has had a number of false starts but the mantle has now been taken on by the deputies' union, with the support of Hugh James, and backing from Irwin Mitchell. They will be formidable foes because of their vast experience in group litigation, and indeed with VWF."

However, Mr Anson added that claimants will face significant hurdles, which are likely to include funding problems, issues over limitation - because it has taken so long to get the cases to court - and problems over causation.

"That said, they have deliberately chosen the government as the sole defendant, with the Department of Trade and Industry the successor of British Coal's liabilities. It is said that the government has paid its debt to the miners, that it's time to draw a line in the sand and they are going to robustly defend these cases. But the score to date in coal miners' litigation has been: claimants two, government nil."

Convenient timing

He also issued a warning about political pressure being brought to bear on these cases by pointing to the likelihood of a general election approaching and the fact that there are a lot of coal mining constituencies, the MPs for which are used to beating a path to the DTI's door.

"So insurers should worry - not so much about whether or not the claimants will succeed on liability issues, but what position the government takes in relation to these claims," he said. "That worry is compounded because, as a result of VWF and COPD, there are a lot of claimant lawyers who have set up sophisticated systems to handle volume claims. Those volume claims will shortly come to an end, and that machine is going to need to be fed."

But in terms of the condition itself, would beat knee claims attract significant damages and is the causative link proven?

Richard Earle, technical director of corporate and complex adjusting firm Teceris, spoke of previous attempts that have been made to bring such claims, but without success: "Typically these claims are low value. When I worked for insurer Iron Trades in the late 80s and early 90s, the shipyards were facing a similar scenario to what is now happening with the coal miners; claimant solicitors were going to run these beat knee claims as test cases, and they failed on causation."

He added that the other problem faced by potential claimants is that they become pain free in a very short period of time, once the activity - of load-bearing while kneeling and twisting or walking over rough ground - has ceased. "So, it is a bit of a gamble to run all these claims for what, in theory, could be very little return to the claimants by way of damages."

Mr Anson then interjected to point out that the previous cases being referred to were for the classic beat knee condition, bursitis, which is a transient condition, and stressed that the newer cases of osteo-arthritis involve a long-term, permanent condition.

"You are right," responded Mr Earle. "To my mind the big question now is whether something is a true bursitis claim, or arthritis aggravated by kneeling? They are two different conditions."

Younger generation

Consideration was then given to whether there is a potential for people younger than the typical ex-coal miner to develop this condition, perhaps from other industries where similar physical activities take place, and what the ramifications would be for liability insurers.

"The situation is that if you have relatively young men who are still of working age, you can have the Smith and Manchester awards and potential loss of earnings, with the general damages on top," explained Mr Hackett. "So, from a claimant solicitor's point of view, they are the higher value. What I have noticed is that the claims we are now receiving are very few in relation to the old bursitis transient condition and there is this new tranche of osteo-arthritic conditions. A lot of people are looking at the miners' situation as to whether they can then replicate these claims in other industries."

Mr Anson was not convinced that the condition would affect younger persons as it tends to affect older people and the vast majority of ex-coal miners are old or even deceased, which makes it likely there will be a high incidence of osteo-arthritis in this demographic group.

Specifically speaking then, what other industries could potentially see these claims emerge. Mr Anson replied: "Any business where people are required to carry heavy loads over rough ground, so you can see that possibly in shipbuilding and construction."

So for argument's sake, the experts were asked whether, should a causative link be successfully proven, these claims could end up being an expensive burden on the insurance industry - particularly if other industries, such as construction, will be closely watching the case brought against government.

"I should not think it is an easy claim to bring if you have had a number of different employers, as people in the construction industry are likely to have had", commented Howard Palmer QC. "They would not be easy claims to bring at all."

As the discussion drew to a close, participants were asked for their views on whether disputes relating to the occupational diseases that had fallen under their microscope could in future be better resolved outside the courts. Should the insurance industry work harder behind the scenes with its opposite numbers - and indeed within itself - to iron out the wide range of issues, such as policy wording discrepancies and apportionment arguments, rather than seek to resolve these through further litigation?

"The reality is that most insurers will take a sensible view," replied Mr Allen. "But others, perhaps those in run-off - those we talked about having a finite fund to preserve and that are not under the same commercial pressures (Post, 5 April, pp14-17) - will possibly argue issues that other insurers would not."

He then referred back to the earlier part of the discussion, with regard to the Mesothelioma Pre-Action Protocol that is being developed, to illustrate that there are in fact efforts ongoing behind the scenes to try and resolve - collectively - some of the disagreements that remain.

"The Association of British Insurers recently analysed approximately 100 settled mesothelioma cases. This revealed that, on average, from diagnosis to notification of insurers of a claim, there was a 12-month lapse. What we are endeavouring to do via the protocol is ensure much earlier notification - not at a formal level initially, just a 'this claim is coming'. Then we, as an industry, can get the ball rolling quicker, involve other insurers and start the investigation. The aim is to be in a position to make an interim payment to the claimant at about 13 to 14 weeks following the formal letter of claim."

Saving time

Mr Bare was also hugely supportive of the work that is ongoing on the mesothelioma front, although he mentioned that the 'number of days' each step should take does remain a small area of disagreement in the pre-action protocol working group.

"The claimant lobby have slightly shorter time periods in mind, and the defendants slightly longer ones. We have agreed to disagree and no doubt the Rules Committee will either pick a date in the middle or decide between us. That is for others to do, but it is an important step for mesothelioma victims."

And summing up the spirit of this working group, and its intentions to reach amicable agreement on such important issues, he concluded: "One thing that staggered the claimant lawyers in the room - which included myself and two representatives from large firms who do mostly asbestos work - was that insurers sometimes wait a year for the letter of claim. We could think of no circumstances where that would be fair, and it should never happen."