For our first evidence session on the Damages (Asbestos-related Conditions) (Scotland) Bill, we have three panels of witnesses. I welcome the first panel and thank its members for their forbearance while we dealt with our administrative business. The witnesses are: Gilbert Anderson, regional representative for Scotland, and Dr Pamela Abernethy, of the Forum of Insurance Lawyers; Nick Starling, director of general insurance and health at the Association of British Insurers; Dominic Clayden, director of technical claims at Norwich Union Insurance Ltd; and Steve Thomas, technical claims manager at Zurich Assurance Ltd. Dr Abernethy, gentlemen, I welcome you and thank you for giving up your time to give us evidence.
Good morning, Dr Abernethy and gentlemen. It has been argued by supporters of the bill that those with pleural plaques have suffered harm, the scarring of the membrane surrounding the lung is a physical injury and damages should therefore be available. Will you each explain to the committee why you think that the harm is not sufficient to merit an award of damages?
Thank you for your invitation to give evidence on this beautiful September day. We rely entirely on the unanimous decision by the House of Lords on the basis of completely agreed medical evidence that pleural plaques are benign; there are no symptoms associated with them other than in the most exceptional cases; and they do not develop into more serious conditions—they are inert biologically. The only issue is that they give cause for anxiety in some people. According to the fundamental law of delict and the law of liability, harm must be demonstrated for compensation to be paid. Pleural plaques do not demonstrate that harm. That is based on agreed medical evidence.
That is clear, Mr Starling. Does anybody else want to have a go?
From my medical understanding and having read with interest the medical evidence in the Johnston case, I believe that the consensus—although it has not been finally established—is clear that pleural plaques are simply the body's physiological response to the presence of foreign fibres. As a consequence of such fibres in the body, there is a release of chemical mediators, which then create fibrous tissue that walls off the foreign fibres. As a consequence of that, the body's defence system operates to effectively prevent plaques from causing harm.
Did I hear you correctly? Are you saying that plaques are a good thing?
That is exactly what Lord Scott of Foscote said in the House of Lords. While listening to senior counsel submissions on the matter, he asked whether they meant that plaques are a good thing. I do not think that I can actually give you an answer to that—
But that is what you have just said.
My understanding of the medical evidence is that plaques are the body's way of trying to wall off the bad fibres.
Mr Starling said that plaques do not develop into serious conditions—
No.
That is what Mr Starling said. What is your view as a medical person? Would they never develop?
My position is that plaques are a marker that an individual has been exposed to asbestos. However, people who have been exposed to asbestos but do not have plaques can equally have a slightly higher than normal risk of developing mesothelioma or asbestosis.
Does anybody else want to have a go?
Let me record my thanks on behalf of the Forum of Insurance Lawyers for the opportunity to give oral evidence on the bill.
You mention exposure, Mr Anderson. How would you respond to supporters of the bill who say that pleural plaques sufferers have been wrongfully exposed to asbestos and are therefore entitled to seek compensation from those who acted negligently?
I am keen to re-emphasise that the bill does not appear to be about culpability. It is concerned only with whether harm has occurred.
This takes us back to my opening remark about the law of delict, or liability as it is in England, which is fundamentally based on actual harm rather than exposure. We can all think of circumstances in which people have been exposed to harm—to harmful chemicals, for example—but have not developed a condition. The fundamental issue is that, as soon as someone develops a condition, whether that is asbestosis or increased risk of a heart attack from exposure to prescription drugs, there is a case for compensation.
In response to the first couple of questions, we have heard—tell me if I am wrong—that pleural plaques are a good thing and are harmless. Is that correct? Does anyone on the panel disagree with that opinion? Mr Clayden and Mr Thomas have not spoken yet.
One would not say that pleural plaques are a good thing. Pleural plaques are a marker of exposure to asbestos, so one is not saying—
Forgive me, Dr Abernethy, but you said that plaques are a good thing—or you quoted without demur someone who said that.
No—
No one would say that pleural plaques are a good thing. That is common sense. However, their presence perhaps demonstrates that the body's defence mechanism is operating effectively. Those are neutral words—
Why is the defence mechanism operating? Is it because it senses that harm has been done?
I am not a doctor, but my understanding is that pleural plaques are a reaction to invading fibres—
Asbestos?
Indeed. I understand that pleural plaques try to wall off the fibres, as I think that my friend Dr Abernethy said. I speak as a lay person; I am a lawyer, not a doctor—
Snap.
The question is therefore properly for the medical profession. However, on the basis of common sense I do not think that anyone would accept that pleural plaques are a good thing, although their presence perhaps demonstrates that the body's defence mechanisms are functioning.
Because the body is under attack.
Indeed.
Indeed. Thank you.
In fairness, I point out that the comment about pleural plaques being a good thing came from a judgment by Lord Justice Scott.
Mr Butler, I did not say that pleural plaques are a good thing. I hope that you appreciate that I was quoting—
I appreciate that, but you quoted the learned judge without demur.
We need to separate the issues. I return to Mr Butler's earlier question. Neither I, nor—I think—any other person who gives evidence to the committee would seek to defend an employer who negligently exposed someone to asbestos. However, the bill does not seek to provide compensation for exposure to asbestos per se.
Cathie Craigie will ask about the history of the matter.
I want to clarify a point that has emerged from the discussion. Does our expert panel of lawyers and insurers accept that the appearance of pleural plaques indicates that a person has had significant exposure to asbestos and that throughout the person's life there will be a risk of their developing mesothelioma?
The presence of plaques indicates exposure to asbestos and is quite widespread. By some estimates, as many as one in 10 of the adult population has plaques, because we are all exposed to asbestos, either through the workplace or through general environmental exposure. When someone has been exposed to asbestos there is a risk that they will develop conditions, but the risk is relatively small.
Is it agreed that that is a risk?
If someone has been exposed to asbestos, whether they have pleural plaques or not, there is an increased risk that they will develop further asbestos diseases.
I emphasise that that risk exists for people who have been exposed but who do not have plaques. The fundamental point that I tried to get across earlier is that it is not the plaques that create the risk, but the exposure. Someone who has been heavily exposed might not have plaques, while someone who has been lightly exposed might have plaques. One of the anomalies in the bill, in its present form, is that one of those people would be entitled to compensation and the other would not. That is not consistent, transparent or even-handed, and such inconsistency is not good for the Scottish legal system.
I am sure that we will consider that point further as we go through the bill.
Before passing the question to the experts, I will just say that, in almost all those cases, the premiums were collected in the 1940s, 1950s and 1960s, which was a long time before any compensation was payable for pleural plaques. The history goes back a long way.
The question why we paid those claims for many years and then stopped doing so comes up frequently. As an insurer, we follow the decisions of the courts. We paid past claims in accordance with courts' decisions that that was the right and proper thing to do. In the 1980s, the Ministry of Defence pursued cases in an attempt to work out whether pleural plaques should be compensatable. There was some ambiguity in the medical evidence at that time, but the judiciary ruled that it was right and proper that compensation should be paid.
In the 1980s, the MOD cases suggested that compensation should be paid. It must be recognised that litigation is an expensive process and that more cases were coming to the insurance industry, which was also expensive. One of the reasons for making the challenge in the courts was the significant cost of paying compensation for pleural plaques, which we do not believe is right.
Some people might say that the change has been made because, in the 1980s, compensation was being paid out not by the insurance industry but by the Ministry of Defence using Government money.
I will make some opening remarks and then ask Mr Clayden to comment.
I can only build on those comments. The fact is that we operate in an adversarial court system, and one of the features of the court case is that there was no significant difference in opinion between doctors for either party. That was not the issue in the court proceedings. As a result, it is not a question of insurers picking and choosing the doctors whom they listen to. In our view, there is significant agreement in the medical profession about the benign nature of plaques.
But the impetus for the change in the insurance industry's opinion was that there would be more—and more expensive—cases, which would mean significant costs.
What you suggest was certainly a feature.
It is worth clarifying that the Rothwell and Johnston litigation was initiated by a Government department: the Department of Trade and Industry. The insurance industry became involved in the litigation after that, because we felt that we needed to have a voice in what would clearly be an important case.
You have indicated that if the bill is passed and enacted, the resulting higher costs to the insurance industry will be passed on to customers in the form of higher premiums. Are you able to quantify those higher costs and higher premiums?
On the overall issue of cost, we feel that, by being based on the number of sisted cases, the regulatory impact assessment has hugely underestimated the potential cost of the legislation. As I said earlier, it has been estimated that as many as one in 10 of the adult population has plaques; if the bill were to become law, it would be saying in effect that those people are entitled to compensation. On top of that, we would certainly expect people to encourage others to come forward and make claims. There are, for example, phenomena such as scan vans, and if we type the phrase "pleural plaques" into any internet search engine, we will find at least one website touting for this kind of custom. As a result, we feel that an immediate effect of the legislation would be a very large number of people making claims.
Part of our concern over the proposed legislation is that, as insurers, we issue a policy today on an assumption of what we believe the law to be and the broad legal position in which claims will be assessed in the future. To answer Paul Martin's question, there are two aspects to the cost impact. The first is that, if enacted, the bill will create further uncertainty in the mind of an insurance underwriter, who is likely to ask, "If I write business in Scotland, will there be a change in legislation that will increase my costs in an unexpected way?" The second aspect is the question of how the costs of pleural plaques claims are to be paid.
Could the panel clarify their answer to what I believe is a clear question? You have made it clear that there will be an increase in premiums if the Parliament passes the bill. However, I am looking for you to quantify what that increase will be. Surely it is not a guesstimate and you are clear about what you expect the increase to be. What kind of figure can we expect?
We have not reached a final position with underwriters, which is something that we will have to do by looking at the legislation. Given the wide bracket of potential claims numbers, we will also have to look at how those develop. An additional point is that—with the caveat that I am not an underwriter but a claims person—I would not expect an underwriter to assume that all employers or premium-paying customers would be treated equally, because there would be the question of the nature of the employment.
But could you just confirm that you said in your paper that there will be an increase in premiums?
Yes.
Surely you do not say that without making a calculation that clarifies how you arrive at a particular figure. Somebody must answer the question by saying, for example, "We have assessed the bill and calculated that there will be an increase in premiums." For the record, have you just guessed that there will be an increase in premiums? You stated clearly in your paper that there will be an increase in premiums.
Absolutely. That is the expectation.
An expectation.
But that will be taken in the round because how an insurance premium is calculated is ultimately subject to an assessment of the claims costs and competitive market forces.
So it is possible that there will not be an increase in premiums.
There may not be, but if the bill is enacted, it will create an upward pressure on premiums in Scotland.
Just for the record, that could be said about any claim that is made. Any environment in which the insurance industry finds itself can have an effect on premiums. That could be said about any legislation that we pass that relates to the insurance industry.
An issue that is significantly different in this situation is the prospect of significant retrospective change to the law. We have not faced such an impact on the insurance industry in Scotland previously. The House of Lords ruling is not binding in Scotland—that is a separate issue—but if it was followed in the Scottish courts, then changing the law retrospectively would be a worrying development for us.
Paul Martin asked whether something could be stated for the record, and perhaps I can help with that. Scottish businesses currently pay a total of £131 million a year in employers' liability premiums. I said earlier that, should the bill become law, the possible cost would be between £76 million and £607 million annually. That is an early indicator of how premiums could change.
I seek some clarification. I know that the figures were not produced by you, but they are a bit vague. We are talking about a bottom-line figure of £76 million and a top-line figure of more than £600 million. The disparity is fairly dramatic. I am not a student of actuarial science, but the bottom-line figure of an additional exposure of £76 million would mean that the total for employers' liability premiums of £131 million would have to be increased by roughly 50 per cent. If the figure was £600 million, the impact would be much more dramatic. I know that those are Government figures, but how were they obtained? We need that information, because an increase in the premium of £76 million is one thing, but an increase of £600 million is something else entirely.
The figures were based on actuarial data. By definition, the extent of the increase is extremely difficult to assess. It is a known unknown that a large number of the population have pleural plaques. They do not know that they have them because they have no symptoms—the pleural plaques do not impair their health. According to some estimates, as many as one in 10 of the adult population will have pleural plaques. It is estimated that for every one mesothelioma case, there are about 25 to 30 cases of pleural plaques. By definition, we are talking about a range, because there are numerous uncertainties involved in calculating the figures.
Forgive me, gentlemen, but I want to press you on the issue. Some of us have run the odd business in the past and we are used to numbers. The convener has pointed out that the bottom-line number represents an increase of 50 per cent in employers' liability premiums. I note that none of you has been prepared to say that. If the £600 million figure is correct, that is four times the current annual premium income. Why are you not prepared to say that the bill will result in premiums having to be increased by a factor of about four? That is what the maths says. Whether the factor in question is three, five, 10 or two, we are talking about a big number. Why are you not prepared to say that? Why are you just suggesting that the numbers might or might not be affected, when that is entirely inconsistent with the maths that we have just done for you?
When one breaks the numbers down, one finds that not all the costs that are associated with pleural plaques will be met by the insurance sector—any compensation will result in a significant cost to the state. The figures that have been quoted are global figures for costs in Scotland as a whole. A significant uncertainty that the insurance industry faces is that we do not know how much of those costs will fall to be picked up by the MOD or other formerly nationalised industries. Ultimately, if the bill is enacted, it will create a significant upward pressure, the cost of which will have to be borne in part by the insurance industry.
Forgive me—I am not looking for certainty. I acknowledge that uncertainty is the business that you deal with and I do not have a problem with that. However, as an engineer, I recognise an order of magnitude when I see it, and there is a huge difference between an increase of 10 per cent and an increase by a factor of six.
I will explore an example with you. My company exists in a competitive market and although I sit alongside Mr Thomas from Zurich Assurance this morning, when we walk out the door I hope that he does not win business and that we do. In that competitive market we will take a view of what our claims cost will be. It is partially based on the future and inevitably involves looking at whether we could recoup some of our losses in past years. That would be different if new entrants came into the market. I cannot legislate for that; it is hugely difficult. If we were in a situation where we were looking to recoup all those past costs absolutely, it is clear that scaling would occur.
I want to pursue your comment about changing the law retrospectively. I accept the point in principle, but surely that does not apply in this case. I think that all we are being asked to do is to restore the law to how it was believed to be before the House of Lords ruling, albeit that the ruling said that the law was wrong previously. Surely if the bill is passed, we would only be restoring it to the condition in which you thought you were underwriting business prior to the House of Lords judgment. We are not proposing to change the law under your feet.
I understand that the House of Lords declares the law as it has always been—that is the legal principle. The issue with which I am particularly concerned is whether the Lords will clarify that the law is different in Scotland and we will simply face reversal legislation. Insurance has a basket of approaches. It is not all swings; swings and roundabouts are built into it.
If the bill had been passed in 1930 and was the law of the land, you would have been underwriting business in exactly the same position as you were prior to the House of Lords judgment.
At a global level, I do not think that any underwriters from that time anticipated the level of asbestos claims that developed. I will be absolutely open and clear: the premiums that were collected on a ring-fenced basis for such risks in no way reflect the billions of pounds that the insurance industry has paid out.
I understand and respect that entirely. You said that insurance has swings and roundabouts and no doubt you have collected more premiums in other areas or you would all be out of business—that is the nature of what you do. However, I reiterate the point that if the proposals in the bill had always been the law because they had been passed into statute, you would have been in exactly the same environment.
Perhaps we need to turn to the lawyers on my left, but I understand that liability or delict has always been determined by the courts in this country, not by statute. Therefore, the courts have decided at various points that on some issues there is liability or that more needs to be paid. The insurance industry has always accepted that. It has accepted where it has had to pay more; in the case that we are discussing, it has to pay less. However, I am not a legal expert.
Let us hear from Mr Anderson.
I will try to be helpful. Essentially, the common law of the land is a matter for the courts. As Dominic Clayden suggested, when the court decides a point of law—in this case the House of Lords in the recent Johnston case—the impact is that the common law is deemed always to have been thus. Does that answer the point?
Yes, it answers the point, but I understand the law as you described it, as I did before you did so. That does not alter the fact that you are underwriters and that you underwrite in what you perceive to be the legal situation. The lower courts made the law previously and at that point, you were underwriting business. We do not propose to change the legal framework in which you do that.
Absolutely. There can be all sorts of reasons why cases settle; sometimes there can be many wrong reasons as well as right ones. However, until the appeal courts make a determination—I do not know the reason why but the Ministry of Defence chose not to appeal—everyone has the right to have the decision of a lower court tested, up to the ultimate court of appeal. Once that has been done, the common law says that the decision of the highest court is a statement of what the law has always been. That is one of the interesting issues here. It is about the difference between the judicial and legislative functions.
Indeed. As you might know, there are 200 cases sisted in the Court of Session. We had been looking for test cases to test the law in Scotland's higher courts even when the Rothwell case was at the Court of Appeal stage—as members will know, a House of Lords decision is not binding in Scotland, although it is highly persuasive. Since the House of Lords judgment, there has been one case where Lord Uist has followed the House of Lords decision, so it looks as if the Scottish courts will do that. As Lord Hope said in the House of Lords decision, the case is all about fundamental principles of law, which are the same in English law as they are in Scots law. Gilbert Anderson has already explained those to you: as a result of the breach of duty, there must be harm. The House of Lords said that there was no harm. Lord Uist said:
Has Lord Uist's judgment been taken to the division?
No, it has not.
I have a question on numbers. Do you have a definitive statement to make on where you gained the evidence that one person in 10 has pleural plaques?
If you will excuse me, I will look at my notes. Annex B of our submission refers to the prevalence of plaques and gives the various possibilities of exposure. We say that
And yet, the Health and Safety Executive states:
As I said earlier, the incidence of pleural plaques is a known unknown. No one knows how many cases there are out there. I am quoting sources such as the chairman of the British Lung Foundation, who I think is a reliable source. I do not know about the HSE figures. By definition, the HSE deals with disease rather than asymptomatic conditions although I do not know whether that explains the difference in the figures. We have always made it clear that there is huge uncertainty around the issue because no one knows precisely the degree of exposure. People in this room will have pleural plaques without being aware of it because they do not carry any symptoms.
The total number of cases is, of course, a vital consideration. The information that we have is, to an extent, contradictory. We have had a fair exchange on the matter, but Bill Butler would like to make a final point.
Before that, could I just finish my point?
Briefly, please.
I am interested in the numbers. However, I get the impression that our witnesses are creating an aura of uncertainty. As Nigel Don said, they have suggested that there is likely to be a substantial uplift in claims. However, there was no massive rush to make claims before the House of Lords judgment.
I am not creating uncertainty; the uncertainty is a result of the very nature of pleural plaques. There is a range of professional opinion—we cite some of that opinion in our annex—and we acknowledge that, at this stage, no one can say how many people have got pleural plaques. Further, no one can say what the effect of the legislation will be. As I said, the legislation will in effect make compensation an entitlement, and there will undoubtedly be a lot of people who will have an interest in bringing people forward to claim compensation. I mentioned a website that is already doing so and, in the past, people have gone around with scan vans, which scan people to see whether they can detect pleural plaques so that they can then seek compensation.
My basic point is simple. Before the House of Lords judgment, there were a certain number of claimants. You are suggesting that if the Scottish Parliament reverses that judgment in Scotland, there will be a significant increase in that number. The reason for that is unclear to me.
I think that that is highly likely to happen. At the outset of the British Coal chronic obstructive pulmonary disease scheme, 150,000 claims were expected. By the time that the scheme closed, there were 592,000 claims—in other words, four times as many as had been expected. That happened despite the availability of data that were more statistically certain than those that we have in relation to pleural plaques.
I can give you some numbers that the Institute of Actuaries collated across the insurance industry. In 1999, 500 pleural plaques claims were presented. That figure rose to 6,000 claims by 2005—a twelvefold increase in five or six years. Part of our uncertainty comes from the fact that, in 1996, there was a general holding of breath to see what the Court of Appeal and, subsequently, the House of Lords would do with the cases. The vast majority of cases that we deal with are presented through solicitors, a significant number of whom are working on a no-win, no-fee basis, and it is our understanding that solicitors who are faced with uncertainty around the proposed legislation have simply put the brakes on until they understand what the situation will be.
Three members are indicating that they would like to ask questions, but I will invite Bill Butler to speak first. What he says might answer some of the questions.
Mr Starling, in response to an earlier question from the convener, you said that your figures were based on actuarial detail. Is that actuarial detail the figures of 500 and 6,000 in the Institute of Actuaries report that Mr Clayden has just mentioned?
I was quoting actuarial detail that the UK Westminster Government used in its evidence. I think that Dominic Clayden was talking about actual claims.
Would it be possible to provide the committee with written evidence of the source of the figures? That would help us to understand clearly.
Yes, of course. We included some information in our submission, and we can make available the Westminster Ministry of Justice's consultation document.
It would be helpful if that information could be forwarded to the committee.
Yes, it would. As you rightly say, Mr Starling, there is information in your submission. However, the submission does not explain how the figures were calculated, and I think that committee members are concerned about that. If you could provide us with a somewhat more expansive answer, it would be helpful.
I emphasise that these are not our data; they are data that the Government used in its publication in, I think, June of this year.
You referred to those data in your answer to the convener, so it would be very helpful if you could convey the data to the committee.
Scan vans have been mentioned. How many scan vans are operating in Scotland, and how many have been operating over each of the past five or 10 years? Do you have information on scan vans, claims farmers and the like?
We do not have data on that, but we know that scan vans exist and we know that people are there to make money out of claims. Our point is that, once you create an entitlement to compensation—which is what the bill will do—people will urge others to come forward and make claims. They will do that in various ways—through websites; through the kind of advertisements that we are all familiar with; and, at the extreme end, through scan vans. We know that scan vans exist and we would expect them to arrive—I do not know how you could stop them from arriving. Our concern is about what will happen in future rather than about what is happening now.
Do scan vans exist in Scotland at the moment?
I do not know. However, they have no reason to do so because pleural plaques are not compensatable at the moment. The moment pleural plaques are compensatable, you would expect people to try to discover them.
Have scan vans existed in Scotland for other issues such as asbestosis, pulmonary carcinoma or mesothelioma?
My understanding is that scan vans were looking only for asymptomatic conditions. You do not need a scan van to say that you have asbestosis or mesothelioma. However, we are talking about something that is likely to occur if the law changes.
However, it is not definite that scan vans will appear in future.
The racing assumption is that it will be in various people's interest to make others come forward to make claims.
You are making an assumption based on no evidence whatsoever.
If you type "pleural plaques" into Google, you will already find one website that encourages people to come forward because they will now be able to make claims.
With respect, we are talking about scan vans and you are claiming that there is a history of them in Scotland. On what evidence do you base that claim?
I am saying that there is a history of scan vans in the United Kingdom; I have no specific evidence about Scotland.
Well, Scotland is part of the United Kingdom. You are basing your claim on no evidence whatsoever. Is that correct, Mr Starling?
I do not have it in front of me, but there has certainly been evidence of scan vans operating in the past.
In Scotland?
By definition, they operate somewhat quietly. As I say, I have no specific evidence with me, but I am talking about what has happened generally in the UK and what we expect will almost certainly happen if the legislation is enacted.
I hear clearly what you are saying.
You have suggested that it is in solicitors' interests to find evidence of pleural plaques through, for example, the use of scan vans. Are you suggesting that individual companies might try to profit through such practices?
There is certainly clear evidence that legal firms can make money from the referral of cases.
So such activity would be in the interests of solicitors. I suggest, however, that it is in the interests of insurance companies to ensure that scan vans are not available, given that they enable such cases to be brought forward. Is it not to your advantage that such claims are not made?
The insurance industry has no powers to control the use of scan vans.
On behalf of the legal profession in Scotland, I point out that the landscape for handling personal injury cases in this country is very different to that south of the border. For example, in England, there are conditional fee agreements, which are not permitted under the law of Scotland or by the Scottish legal profession. As a result, we are not necessarily comparing apples with apples. The point is pertinent, because the committee needs to understand that the handling of cases is very different in Scotland and that success fees and other features of conditional fee agreements do not apply here.
It has been stated that the insurance industry is committed to paying fast, fair and efficient compensation to claimants and that the industry is working on initiatives to streamline claims for people with asbestos-related diseases. Has the industry fought mesothelioma claims in court?
Mesothelioma is entirely separate from the issue of pleural plaques that we are discussing.
I accept that.
Mesothelioma is a malignant condition—
I think that Mr McMillan is simply pursuing the principle.
In previous cases, clarity has been sought from the court with regard to insurers' legal liability. It is right and proper that, as commercial organisations, insurers should be able to ask the court about the legal position on such cases and whether they are legally required to pay compensation. The insurance industry is not a social fund; it provides a contractual indemnity to our policy holders. As such, the insurance industry has in some cases tested whether the insurance policy should operate.
So the insurance industry has fought claims in the past.
It has fought claims in order to understand its legal liability under the insurance policy.
Did the industry support the Rights of Relatives to Damages (Mesothelioma) (Scotland) Bill in the previous parliamentary session?
Yes.
Do you want to respond, Mr Thomas?
I am trying to recall whether—[Interruption.] Yes, we did support it.
I believe that we gave evidence to the Justice 1 Committee at the time.
Are insurance companies currently defending any cases involving asbestos-related diseases either in Scotland or in England and Wales?
As a lawyer acting on behalf of insurers, I think that it might be helpful to point out that some cases can involve more than one defender and that sometimes those defenders do not have insurance cover. That can create difficulties in settling cases, particularly with regard to the question of their contribution. Moreover, someone might claim to have asbestosis when our medical evidence suggests that they have a different condition called cryptogenic fibrosing alveolitis. On the whole, however, we settle most cases as quickly as possible if there is a liability.
There is a terrible danger of overgeneralising. I said earlier that there is a series of hurdles to be overcome for a pursuer to succeed in a personal injury claim, and I repeat that the bill is concerned with the last hurdle.
Let me get to my point. We have received correspondence in which the insurance industry comes across as doing its best and wanting to get things moving quickly to help people. However, we have received other evidence that the real situation is the exact opposite and that the insurance industry seems to be fighting tooth and nail against individuals who go to court to claim damages for asbestos-related conditions. That is the point that I am getting at.
I can perhaps help. You may be alluding to what is known as trigger litigation, which is currently running in England and Wales. That is a piece of litigation that relates to asbestos compensation in which a handful of what we refer to as run-off companies—insurers that are no longer trading or writing business and legacy companies that are endeavouring to look after a fund of money—have brought litigation about policy wording and its interpretation. The live market, including companies such as Zurich and Norwich Union, is opposing that litigation. In effect, we are acting as the defendants and trying to maintain the status quo so that the run-off companies are not successful in their endeavours. That may have been what people have written to you about.
That is certainly part of it. However, although the idea from written evidence is that the insurance companies appear to be the friend of anyone claiming damages for an asbestos-related condition, other evidence suggests otherwise—whether or not that relates to the trigger litigation. That is my point.
My point would be that insurance companies want to pay when they are liable. The issue around the legislation is how to determine liability in cases when the exposure often goes back 20, 30 or 40 years, people have a discontinuous employment history, companies have gone out of business and so on. It has always been a difficult issue, but insurance companies want to meet their obligations and pay when they are liable. That is what they are determined to do.
It has been suggested to me that the insurance industry's opposition to the bill is a bottom-up attack on people's ability to make successful claims on the basis that they have been exposed to asbestos or have an asbestos-related condition. I will give a practical example to explain why I make that suggestion. My understanding is that, if people make a successful claim for compensation on the basis that they have pleural plaques, in the event that they develop a more serious condition at a later date they can return to court for the compensation that will be due to them for the more serious condition. If they have already made a successful claim for pleural plaques, it will have been established that they have been harmfully exposed to asbestos and have an injury, so it will be much easier for them to have that future claim settled. Obviously, when people are seriously ill, time is of the essence. However, if people cannot claim for having pleural plaques, in the event that they develop a more serious illness they will need to go through a lengthy legal process that is open to challenge by insurers and defenders. In that sense, it has been suggested that this is a bottom-up attack, with implications for the more serious cases.
Let me be absolutely clear that this is not a bottom-up attack with the aim of somehow denying those who have a legitimate claim for mesothelioma or for any of the other serious asbestos-related conditions for which people receive compensation. Let me lay that one completely to rest.
I am aware from correspondence that, by comparison with those who previously made a successful claim for pleural plaques and then developed the more serious condition, those who have not made a claim for pleural plaques must start from scratch in establishing their right to a claim.
I see the point that you are making, but I can only reiterate that it seems a disproportionate remedy, given the significant associated costs, to require that compensation be paid at that point so that we can deal with the scenario in which the person unfortunately develops mesothelioma subsequently. If that is the issue, one could explore different ways of achieving that aspect by speeding up the process. Significant dialogue is going on about how the process can be speeded up. I know that we have discussed the range of the costs but, whether those are at the top or bottom of the range that has been quoted, significant costs will be involved in achieving that.
I have two questions, the first of which is directed at Dr Abernethy. She said earlier that there was not much evidence that those who had pleural plaques would necessarily go on to develop the more serious asbestos-related diseases of mesothelioma and asbestosis. I want to put to her the opposite point. Given that she suggested that those who do not have pleural plaques can contract those serious diseases, what is the weight of evidence as to whether people who do not have pleural plaques but have been exposed to asbestos negligently are more likely to get asbestos-related diseases? How far would you push that argument?
Thank you for giving me the opportunity to expand on the issue, because I may not have expressed myself as well as I should have in answer to Mr Butler. My position on the matter is quite simple. Obviously, pleural plaques are an indicator of exposure to asbestos. However, I understand that the fundamental point for doctors is the length and degree of exposure to asbestos. It may be more appropriate and helpful for you to address your question to the medical experts who will give evidence to the committee later—I am a doctor, but I am not an expert in the area, although I have read a lot about it. I do not think that there are statistics that indicate how many people who have or do not have plaques develop mesothelioma. I understand that many plaques are discovered at post mortem in people in whom there has been no disease. However, having plaques is not a good thing, because it is an indicator of exposure to asbestos. I cannot indicate to you in detail how many people who do not have plaques develop mesothelioma. The literature that I have read suggests that the incidence of mesothelioma in those who have had plaques is between 2 and 5 per cent.
My understanding was that a relatively high proportion of people who had mesothelioma had previously suffered from pleural plaques, so the two conditions are associated.
I am not saying that they are not.
We will pursue the issue with those whom I will describe as contemporary medics.
My other question is directed to the insurance industry. You have made great play of the fact that quite a high proportion of the population—as many as one in 10, according to my colleague Mr Paterson's question—may have pleural plaques. Surely the issue for you is whether a company that you insure is at fault for exposing a person to asbestos negligently. The issue is not the number of people in the population who have pleural plaques, but the number of people who have them as a direct consequence of negligent exposure to asbestos, which may be of an entirely different order of magnitude. Surely that reflects past experience—the extent to which negligence is identified is the most important factor in determining the number of successful cases. The problem for people who are considering pursuing cases is whether they can establish negligence by a past employer.
Our opposition to the bill is not driven fundamentally by the numbers, although those are a consideration. We have set out clearly that we are opposed to the bill because pleural plaques are benign and because the best way of dealing with people who have them is not to increase their anxiety but to reassure them that the plaques will not be a problem. The bill also changes fundamentally the law of damages—the law of delict and liability—by saying that exposure is enough to ensure compensation. Finally, it damages businesses' confidence in their ability to go to law and to have judgments upheld, rather than overturned. The numbers are important, and we have drawn attention to them because they have been seriously underestimated, but I have given our fundamental reasons for opposing the bill.
The final question, from Margaret Smith, is directed to Mr Anderson.
My question relates to the bill's implications for the law of damages, which have been mentioned at several points. What are your thoughts on issues relating to precedent? We have discussed the fact that there is a lack of hard data on the impacts that the bill would have even in relation to the narrow issue of pleural plaques. If you are concerned about the implications of the bill setting a precedent for other conditions, your concerns about premiums are presumably almost stratospheric.
I could not give you an actuarial answer as to which stratosphere we might be in.
You are concerned about—
The principle.
You are concerned about the principle of the matter and the focus on anxiety. Some people might say that anxiety can have detrimental effects on people's mental health, and that it is not without harm in itself.
Well—
If the anxiety leads to damage to mental health, that does translate into harm. Then, people may recover damages.
Let me pick up on a smaller issue, which relates to what Angela Constance was discussing. You raise the matter of the time bar in your submission. You say that the bill might have the undesirable consequence of allowing time to run out for the claimant, starting from the point when they were informed of the presence of plaques. You are suggesting that if they do not come forward within three years, that could impact on their ability to make claims at a later stage—presumably not just for pleural plaques but for the more serious manifestations of exposure to asbestos. Is that a fair reading of what you were trying to say in your submission?
Yes: a great deal of uncertainty and confusion would be caused as to when the sand starts to come out of the egg timer, as it were. This is relevant to the point that Ms Constance raised. People would be concerned about whether or not they should settle fully and finally, thereby possibly depriving themselves of further damages in the event that they develop actual compensatable disease later. That was one of the difficult issues in the decision by Lord Prosser in the case of Shuttleton. Is the pleural plaques claim time barred or is the whole claim time barred? For me, the application of good solid principle to a number of circumstances is the best way for our common law to evolve. Frankly, to make specific changes for this or that disease or condition or for other situations causes chaos and does not lead to consistency and predictability, which legal advisers need if they are to give meaningful advice with any certainty. At the end of the day, lawyers are paid not to raise cases in court, but to give good advice and ultimately, one hopes, to keep clients out of court.
I want to pick up on the point about whether the time bar would apply to the pleural plaques or to the final manifestation of the disease. In answer to Angela Constance, Mr Clayden said that she should separate out those two things, which are the beginning and the end of the process. You might advise someone that they should attempt to separate the two. Clearly, if that person went on to develop asbestosis, the harm could be shown to be considerable and the compensation could be considerable. From what Mr Clayden said, the two things should be seen as separate.
I have two points on that. If someone came to me in relation to a claim about asbestos-related disease that was based purely on plaques and anxiety, the first thing that I would tell them would be that they had suffered no harm and that they therefore did not have a claim. My friend Frank Maguire would do the same.
We still have slight concerns about costs. I will come back briefly to Nigel Don.
The witnesses will have seen the financial memorandum, paragraph 16 of which suggests that, on average, about a third of any compensation goes to the claimant and about two thirds disappears in fees. That is all order-of-magnitude stuff. I acknowledge that not all the fees go to lawyers—I have nothing against lawyers—because medical evidence and other things that cost money are required. Are those numbers defensible, in that not much more can be done to improve them from the claimant's point of view? If they are not defensible and could be improved—which I am sure all members would prefer—do you have any suggestions as to how that could happen?
That is an interesting point, which Lord Gill and his team are considering closely. The issue is very much about proportionality, and it is part of Lord Gill's remit in conducting the civil courts review. The law must draw a line somewhere. We must have procedures that do not make the cost of pursuing rights disproportionately high, given the value of the case. We may live in a society in which we know the price of everything and the value of not a lot but, sometimes, we cannot put a value on justice.
Let us assume that the bill is passed. Would there be scope for the insurance industry to recognise fairly early on in the process some level of claim which, no doubt, would have to be sorted out in court? Where it was likely that there was liability, would the industry be prepared to pay out on the ground that that would be a better bet than taking a case to court?
I can answer the question only in general terms. You know FOIL's position on the bill. In my experience—I am sure that it is the same for Pamela Abernethy—the insurance world does not want litigation; it wants the evidence to be produced as quickly as possible. In essence, the industry wants a more inquisitorial approach to be taken to investigations. If liability is to be found, the industry wants it to be found as quickly as possible and to settle. Litigation should be a last resort.
The insurance industry encouraged us, as lawyers, to draft a pre-action disease protocol. I did that in Scotland. The protocol was revised and was circulated to the Law Society of Scotland—
We have evidence in that respect, Dr Abernethy.
The protocol is now up and running. I think that claimants' firms were also involved. The aim was for any individual who suffers from a disease to access justice more easily. I understand that negotiations are under way on a mesothelioma pre-action protocol. In other words, the intention is to avoid going to court, which, I hope, should reduce legal costs. People might say, "Surely that acts against lawyers' interests," but our ultimate duty is to the courts and our clients. We want to ensure that we help them and that we help claimants. We are not here to not help claimants to get justice. We are here to help.
I may have misunderstood the presumption in your question, Mr Don. I think that it was that insurers somehow enjoy the prospect of increased costs. However, we take every step to reduce costs. Ultimately, we believe that lawyers are in business as much as the next person and that they seek to make a profit. The profession is not altruistic. I say that as a lawyer: I can criticise my fellow professionals or be realistic about them. We seek to reduce costs. It is in our interest to do so.
We can leave that for another day.
I want to make absolutely clear my greatest respect for lawyers. I understand to some degree what they do. I have no problem with lawyers charging, making a profit and all that kind of stuff. That is not the issue. My point is that the numbers that we are looking at are very high. It appears that a disproportionate proportion of what should be compensation disappears. One therefore has to ask about the process.
This evidence-taking session has been lengthy and important. One matter is outstanding, which Mr Starling has undertaken to remedy. I refer to the figures that Mr Butler requested on the UK Government's research into the number of cases and likely costs.
Meeting suspended.
On resuming—
We turn to the next panel of witnesses. I welcome Dr Martin Hogg from the University of Edinburgh and Professor Anthony Seaton from the University of Aberdeen. By way of introduction, Dr Hogg is senior lecturer at the University of Edinburgh's school of law. His main areas of research lie in all aspects of the law of obligations. He is currently researching liability for the causation of asbestos-related mesothelioma and liability for pleural plaques.
Good afternoon, gentlemen—well, it is almost afternoon. Professor Seaton, in your experience, what impact do pleural plaques have on those with the condition?
First, I would like to clarify some of the misunderstandings that I have heard this morning, which made me wonder what people have in mind when they say "pleural plaques". Most people with pleural plaques have no symptoms at all and do not even know that they have them. They tend to discover that they have them when they have an X-ray for some other condition. However, those are only the pleural plaques that show up on X-rays. I am sure that many more people are going around with pleural plaques that do not show up on X-rays.
Much easier.
I have been a chest physician since 1970. I am now a retired chest physician. In my early years of practice—I wrote my first book on occupational lung diseases when I was a chest physician in Cardiff in 1975—it was quite simple to deal with patients in whom one found pleural plaques coincidentally. One treated the condition that they had come to see one with, which was usually a condition such as bronchitis or asthma that was unrelated to the plaques, and told them that they also had scars on the inside of their chest wall that were not attached to the lung, were not affecting the lung in any way and were not causing them any symptoms.
You have given a detailed answer to a question that is, on the face of it, simple, but which is really, as you have said, far more complex than that.
Yes, with the proviso that, as I have said, anxiety will be a natural consequence for someone who is told that there is something the matter with their X-ray. In such circumstances, it is the chest physician's job to explain the implications of the radiological findings. One's objective would be—indeed, my objective still is—to reassure the person and tell them about the real risks that they run and why they run them. That can be done reasonably simply.
Finally, is the view that you have expressed to the committee the unanimous opinion of the medical fraternity?
That is like asking whether all lawyers are agreed on everything.
The question is pretty simple.
Like all questions, it is not as simple as it seems. There is, of course, no such thing as the unanimous view of the medical profession on any subject, because the medical profession is composed of people with all sorts of different views. However, if you ask me whether it is the unanimous view of people who have studied the issue and who are expert in occupational lung disease, I say that it is.
So you are giving a simple answer to a complex question because you define it according to those who have experience in the particular field. However, I am asking you whether people who have comparable experience in your particular field of expertise all agree with what you have said this morning. That is a fairly simple question.
Well, it assumes that I know everyone and their views, which I do not.
Yes, but by and large—
It is not a simple question. It is easy to frame what appear to be simple questions. I know of nobody who has studied the issues who would disagree with what I have said. I know most of the major players in the field in Britain, the United States and Europe and I would say that we are unanimous. However, you could, of course, go to a radiologist or general practitioner who has not studied the field and does not know the literature who might take a different view.
Okay, that is a fairly clear response regarding your view, and I am grateful for that.
I do not think that most people in my field would disagree with it.
In your view. Okay, thank you.
In his opening statement and in answer to question one, Professor Seaton answered some of the questions that we had in mind, but we will proceed with Nigel Don in any event.
Thank you, convener. I really would like to hear a definitive answer to one question, Professor Seaton. It is whether someone who has contracted mesothelioma or asbestosis will have shown symptoms of pleural plaques or whether a sizeable chunk of those who go on to develop the real medical conditions do not at any stage develop plaques.
You said symptoms of pleural plaques, but there are no symptoms.
Yes, I am sorry. I meant plaques.
The answer to your question is no, because most of them will not have had a chest X-ray, therefore plaques will not have been seen. Most people with mesothelioma—I have seen very many of those unfortunate patients in life and at post mortem—do have pleural plaques. They are not always visible on their X-rays, but they are usually visible at post mortem.
Forgive me, but this part of the logic is crucial, and I really want to nail it. If I could say that every patient who contracted mesothelioma or asbestosis had pleural plaques—a figure of 95 per cent would be fine for the basis of the argument—I would be able to conclude that the development of pleural plaques indicated a different statistical regime. That would apply even if, under the original regime, in which you had never measured or gone looking for plaques, the figure had been less. In other words, if everybody who developed mesothelioma or asbestosis had, on the way, developed plaques, the intermediate stage where you found plaques would change the statistical likelihood of the patient in front of you developing mesothelioma or asbestosis.
Well, pleural plaques are much more common than mesothelioma. Most people with pleural plaques do not develop mesothelioma. Perhaps as many as 1 in 20 or 1 in 10 might develop it. It is true that the epidemiology shows that radiologically-diagnosed pleural plaques—which I accept is not the same as pleural plaques—entail an increased risk of mesothelioma. However, if that is corrected in our analysis of individuals' exposure—we are talking about people who have been exposed to asbestos—that increase in risk disappears, because the risk is not due to the plaques.
I am entirely with you. I am using plaques purely as a marker or an indicator. I am not suggesting that they are in any sense malignant or pre-malignant. They are merely an indicator that the patient is in that fraction of the population that is, because it has been checked, at greater risk of developing mesothelioma than the population of which they were a part before the test was done.
They are in the population that is at greater risk of mesothelioma. That population is the population of individuals in that birth cohort who have been exposed to asbestos.
Yes.
The people with plaques are at no greater risk than are the people without apparent plaques within that population. If we adjust for age and exposure to asbestos, plaques do not mean that someone is at greater risk. That is the important point. If we compensate someone for having pleural plaques, it is logical to compensate all those people who do not have pleural plaques but who had the same exposure to asbestos. The trouble is that plaques do not indicate the intensity of exposure. That is a critical fact.
I am with you there, but can I go back to the other end of the argument? If everybody who is found to have mesothelioma has plaques—
Well, pretty well everyone does.
All right—pretty well everyone. I mean, near enough that we can have the argument and the discussion—
But they are not always radiologically apparent, which is what the bill is about, as I understand it.
Perhaps not, because the definition in the bill has nothing to do with how plaques are measured. It is just concerned with whether plaques exist, so it does not matter whether there has been an X-ray or CT scan.
That opens a can of worms.
It might open a can of worms but, nonetheless, if we are changing the law—sorry, we are getting into evidence in law, and we should never do that, because by and large it is a mistake.
Well, yes. I think I said that, if someone has pleural plaques, they are at greater risk of having mesothelioma than are people in the population at large, including you and me. Well, not me, because I have been exposed to asbestos. You probably have as well, as an engineer. However, a person is not at greater risk than are other people who have done the same job, if you like. It is the job and the exposure that are critical, not the plaques.
I entirely accept that the person is not at greater risk than those who did the same job but happen to be different physiologically such that they are fortunate enough not to respond to asbestos in the same way. I am with you there, but if those who have contracted mesothelioma have plaques, I think—I must be careful here—that those who know they have plaques are entitled to take the view that they are now known to be at greater risk of developing mesothelioma than the population in which they were before the test was done.
That is absolutely correct and it lies behind the point about anxiety that I was trying to explain previously. As I understand it, the issue is about compensation for anxiety about the possibility of developing serious and fatal diseases. When a good chest physician is confronted with a patient with pleural plaques, he will try in so far as is possible to give the facts. The facts are not wholly reassuring, but they are sufficiently reassuring to stop the patient becoming obsessed with mesothelioma and just waiting for it to arrive. In other words, the risks are lower than many other well-known risks, such as those from smoking.
If possible, I would like to put some numbers—and certainly some algebra—on this. As members of the general population, we have a one in a million chance of dying of mesothelioma. Is that right?
Yes, the chances are one in a million when unrelated to asbestos exposure. Mesothelioma is an uncommon disease.
Forgive me, but let us now forget the general population. If we know that we have been exposed to asbestos—as you and I probably have—the risk is different but it is still pretty low.
Yes.
If someone who has been exposed to asbestos asks you what are their chances of developing mesothelioma, your answer is one in something.
Yes.
If, however, a comprehensive X-ray scan or whatever reveals the existence of pleural plaques, that person's chances of developing mesothelioma are statably higher because they are in a smaller population of people who are likely to develop the disease. I think, if I may say so, that that is the nub of what we are about. At that point, someone who knows that they have plaques is entitled to be anxious—albeit not much—that they are at greater risk of developing a disease that they will have contracted from asbestos.
They will not be at greater risk than their workmates who do not have plaques—which is an important point—but it is true that they are at increased risk of developing mesothelioma.
So the diagnosis of plaques is, in your view, a justification for some level of anxiety. The statistics have changed, simply because we know more.
I said right at the beginning that it is absolutely sure that someone who is told that they have pleural plaques will initially be anxious as a consequence. The job of the doctor is to tell the patient about likelihoods. Afterwards, the patient will usually feel reassured that their condition is unlikely to develop into a more serious disease. What you say is quite right; I do not think that there is any great difference of opinion between us on this point.
Gil Paterson, has your point been answered?
Not yet. For clarity, I wonder whether Professor Seaton will say whether pleural plaques are caused only by exposure to asbestos.
To all intents and purposes, yes. Many other things cause fibrosis of the pleura, but asbestos-related pleural plaques are very characteristic pathologically.
That is becoming apparent.
I am still at it with my questions.
Can you continue at it briefly?
I am sorry about my answers, but I am not going to pretend that the issues are straightforward when they are not.
I would like to clarify this. If someone has pleural plaques, they came from exposure to asbestos. Or is that too simple?
I am prepared to concede that there is a characteristic sort of pleural plaque that can be quite easily diagnosed radiologically and that is certainly due to asbestos.
Are there any other diseases—you may have a different description—that are similar to pleural plaques? Is there anything else, that is similar, that you can view, that may develop into something else? Is there something similar to pleural plaques, or is it only pleural plaques that have a signature that signifies that the person has been exposed to asbestos? Is there anything else that has a signature that can be somewhat confused with pleural plaques?
The question as I understand it is whether, when we see what we think are pleural plaques on someone's X-rays, we can say that the person has been exposed to asbestos. The answer to that is yes. There is another question, which is whether there is anything else that looks like pleural plaques and can be mistaken for them. The answer to that question is also yes—particularly fat pads under the ribs.
My main question is whether there is some other stamp that shows that something is there but will remain dormant although there is a good chance that something else will happen in a certain number of people.
In relation to asbestosis?
No, anything. In other words, is there anything peculiar to pleural plaques? Is it a unique condition? You say that pleural plaques are harmless, but an above-average proportion of the people who are identified as having them are likely to have an asbestos-related disease. Is there anything else like that that is not related to asbestos?
Yes. If someone drinks too much whisky, it is easy to determine their risk of developing cirrhosis by doing blood tests on them. There are many medical indicators of future disease. Pleural plaques are different in that they are an indication of exposure to the toxic agent.
Yes. Thanks very much.
We have one final question from Paul Martin.
I have two questions, actually.
Sorry, but—
You have made considerable play of the anxiety that is created by the implications of the present legal framework. My point is that people can become anxious as a result of information from different sources—it does not have to be provided by solicitors.
Oh goodness, no—all sorts of things can make people anxious, but lawyers are pretty good at it. Surely everyone recognises that the process of litigation is a huge cause of anxiety. Someone can make themself anxious by looking on the web—that is commonplace nowadays.
But your submission suggests that causing that anxiety is monopolised by the litigation industry. My point is that, following a visit to the consultant, people can be anxious for many reasons. Twenty or 30 years ago, a visit to the consultant would probably have been people's only source of information on their condition. We cannot get away from the fact that the public are much better informed about conditions and have opportunities to follow through on that, without the need to visit a solicitor. Do you accept that anxiety can be created in different ways following a consultation?
I do not think that I implied that lawyers are the only cause of anxiety. I accept that doctors cause a great deal of anxiety if they give people uninformed advice. All I am saying is that it makes it difficult for chest physicians to give the impartial and objective advice that they should give if there is a conflict between what they say and what the law says.
I appreciate that, but your submission states that the medical process has been "handed over to lawyers". I am trying to make an objective point. The point that I am trying to extract from you is that the process of creating anxiety is not necessarily handed over to lawyers, because anxiety can be created in different ways.
I have spoken on the issues for 30 years, although I make it clear that I am no expert on the legal matters. When the law appeared to be changing and patients of mine were entering into the litigation process, I was informed by a lawyer that I would be regarded as medically negligent if I did not tell patients that they should or had the right to consult a lawyer. That was unequivocal advice that I was given by a law firm in Glasgow at the time. I remember it clearly because I made the point to that lawyer—who I think is here—that that made it difficult for me to give patients sensible and helpful advice. I had to put the issue into perspective and tell them that their chances of getting serious diseases were slight, although they had a somewhat increased risk, but then add, "By the way, you must go and see a lawyer."
You will have heard in the previous evidence the references to scan vans and to the possibility of their being introduced in Scotland. Do you have any knowledge of scan vans operating in Scotland or in other parts of the UK?
That depends on what you mean by scan vans.
We heard that businesses in different parts of the country are using scan vans to identify pleural plaques.
I think that what you mean are mobile X-ray units.
That is right.
I certainly believe that there are such things as mobile CT units in Scotland, because I have come across people who have had X-rays taken by them. They provide expensive X-ray facilities to hospitals that do not have them. In general, however, there is less of a need for them in Scotland because the national health service is better provided with such facilities and getting a CT scan in the local hospital is usually quite straightforward. I am pretty sure that such units exist, but I am not saying that they are used to trawl for patients or to get business for lawyers.
So you are saying that you are pretty sure that there are vans of this type, but that they might be part of the NHS.
I think that there are. I know of hospitals in which people have talked about the mobile unit coming around. However, as for the question of who owns it—
Are you talking about mobile units in remote areas?
Yes. However, I do not think that that is relevant to this issue.
No. I can see why you have given that answer to the question, but I do not think that the scan vans that you are talking about are the same as the scan vans that we have in mind, which are organised by personal injury lawyers.
I have not come across such things. That said, of course, there is a commercial interest in maximising the number of people who come forward with pleural plaques, although that can be done through press advertisements and so on. Indeed, I expect that that would happen.
Thank you for that evidence, Professor Seaton. We have no more questions for you at this stage, but I ask that you remain at the table in case we need any more advice.
Of course a personal injury—if that is what you want to call it—should come under the law of damages, but as earlier witnesses have made clear, this bill is not just about pleural plaques; it begins to tinker with the fundamental requirements of an action of delict in Scotland, which for me is the more troubling aspect. Every legal system has to work out the fundamental requirements for bringing a claim in delict. As you have heard, those requirements are that a person must be owed a duty of care that has been breached by the defender; that they must suffer recognised damage; and that there must be a causal connection between the breach of duty and the damage.
To some extent, you might have anticipated the question that Stuart McMillan intended to ask.
In your submission, you say:
If the common law is patently wrong and erroneous, Parliament can intervene, provided that it does so on a principled and sound basis, but Parliament has tended to interfere in our law of delict and our law of obligations very infrequently over the past several hundred years, because the general view of Scots lawyers is that we have an extremely good law of delict that has been worked out over a long period of time and which has come to conclusions that most people, certainly on the issue of damage, acknowledge are sensible.
I am sure that the Cabinet Secretary for Justice will take on board your comments about damage in general when he reads the Official Report of today's meeting, but the bill focuses on a specific area. Do you agree that MSPs and the Parliament can make decisions in this area, if they see fit to do so?
Yes, but after I read the bill it was not clear to me why you want to tell a category of people who, according to the rules of delict that we have had for hundreds of years and according to medical criteria, are not injured that they are injured and to give them the right to compensation. As an academic who has an interest purely in seeing that the law is generally coherent and sensible, I am entitled to ask why the Parliament wants to do that, but nothing that I have been able to find out about the background to the bill has provided me with an answer. I suspect that it wants to do it because it does not want to appear unsympathetic to people who, quite reasonably, are anxious about their state of health and because not doing what it proposes to do would make it look cruel and unconcerned about such people, as lawyers are typically accused of being. You must look below the appearance of generosity that the Parliament wants to give and ask whether you are acting for sound reasons that make sense according to the law as a whole, within which you must operate and for which you must legislate. That is the issue that concerns me.
I am sure that all MSPs want to ensure that justice is done for everyone in Scotland.
I do not doubt that; I am questioning whether in this case justice will be done. The common law on damage that we had for a long time has ensured that justice is done. It has allowed reasonable claims to come to the courts, but it has said to people who have not been and may never be injured that they should wait to see whether they have been injured. If they have, they are entitled to compensation according to all the rules that we operate. If we jump the gun, we will open up a can of worms around compensating people merely because they have been exposed to risk. No legal system of which I know has gone down that road.
Dr Hogg, you have anticipated Nigel Don's question. Would the member like to raise any further issues?
Dr Hogg, you will have heard my exchange with Professor Seaton. Will you comment on the logic—I hope that it can be described as logic—with which I finished? We seem to agree that, whatever the cohort in which someone started, once they have been diagnosed with pleural plaques they are part of a group of people who appear statistically to be at higher risk of developing mesothelioma. At that point, there is the trigger of a perceivable injury—the anxiety that results from their knowing that they are at greater risk than they were before they had that evidence.
You are correct to say that such people are aware that they are in a category of persons who are at higher risk of developing mesothelioma. The question is, should that knowledge, coupled with anxiety about the issue, give rise to a right to claim damages? There are many situations in which people become aware that they are at greater risk of an injury in the future, but in general we do not say that merely coming to know that they are at greater risk of injury gives someone a right to damages, for the simple reason that that would cause a huge amount of litigation to compensate people who may never go on to suffer an injury.
That is my legal question, which I think is a new one. You are right to say that we have not done this before. The issue that we are looking at may be the corollary of the extra salary that we pay to people who do dangerous things.
Yes, but that is a matter of contracting—
I see that Professor Seaton is shaking his head. I know that the agricultural industry, for example, is dangerous and yet agricultural wages are low. Other things being equal, however, there would be—
With respect, that is a terrible misconception. The Scottish Trades Union Congress got rid of the concept of danger money years ago—thank goodness.
The STUC might have got rid of it, but in reality we routinely pay people more for doing dangerous things than for doing undangerous things.
It is right to point out that anxiety can be compensated, but traditionally the law in Scotland, England and other jurisdictions has allowed that anxiety is only compensated if it can be connected to a recognised, present personal injury. If someone has a physical injury that is beyond doubt and they are worried that it might lead to the risk of another injury in the future, that can be compensated as part of what in law is called solatium—compensation for pain and suffering.
We acknowledge that we are developing and changing the law in a direction that you perhaps feel is bad and which is certainly not the direction in which we have gone historically. Is there not a case for developing in that direction, in that people are, perhaps, entitled to be anxious if they find themselves in a category of people who appear to be at a greater risk as a result of what someone did to them—or as a result of what someone did not do to protect them?
That would be a legitimate development if it was done in a consistent, joined-up way, by examining the whole issue of risk exposure in law. Risk exposure is a notoriously tricky subject: the House of Lords has examined it in a number of cases in recent years, with regard to what kind of risk should or should not give rise to compensation.
You suggest in your written submission that a more appropriate regulatory framework could be designed to hold those who negligently expose people to asbestos to account. Can you give us an idea of how you envisage such a scheme working, and the compensation that victims could expect?
I am not even sure that compensation would necessarily be involved. There are two ways to approach the matter. One is to firm up the rules about people being exposed to noxious substances. That approach could be developed—although it is not an issue that I have thought about in depth; I merely suggest it as an alternative, by way of trying to prevent the exposure from happening in the first place. That would, of course, have costs to industry and occupiers of buildings.
I take you back to the issues around potential litigation in other areas and other industries. Do you accept that exposure to asbestos is a specific area and that, as the Cabinet Secretary for Justice has said, the issue needs to be taken forward, to recognise the wrongs of the past?
It represents the biggest incidence of exposure to a noxious substance that can lead to symptomatic conditions—although I am prepared to be corrected by my medical colleague. However, it is not just a numbers game. If there are other categories of condition that might begin as asymptomatic conditions but which could go on to become symptomatic conditions, it seems rather unfair to people in those other categories not to consider their symptoms.
Do you accept that this is an issue for Parliament?
Of course it is.
I appreciate your commentary on the matter and your academic contribution, but it is for parliamentarians to consider the issue. In considering how to proceed with the bill, they should not be affected by the fact that somebody else might wish to highlight their own case. Why should that affect us?
I was suggesting that sensible law reform would consider the issue of exposure to noxious substances, which creates risk in the round. Doing things a little bit at a time is not, in my opinion, a coherent way of reforming the law. If you were just to consider asbestos, that would mask the underlying problem, and it would mean tinkering with the rules governing when there may be actionable damage. To consider one thing at a time plasters over the underlying problem. It would mean tinkering with well-established rules about when someone has suffered a personal injury. I suggest that picking out one condition, for no apparent reason as far as I can see—apart from its producing the greatest number of cases—does not give a good impression on the international stage.
Why do you say that the rules are well-established?
Over hundreds of years, people have brought litigation before the courts in which they say, "I have been injured." Over a great period of time, the courts have developed the idea of when somebody should be considered to be injured. The sands of time have helped to identify the marks of harm that the legal system recognises. To change one of those long-established marks of harm without seeming to know why is a slightly dangerous thing. The common law of delict and of obligations in general works very well, because it has involved a great sifting of the rules over a long period of time, at the end of which good sense and justice seem to have prevailed. Suddenly, however, we seem to be changing tack, and I am not quite sure why.
Stuart McMillan has one brief further point for Professor Seaton.
Towards the end of paragraph 6 of your submission, you say:
You know that I am not a lawyer; the issue is for lawyers to comment on. I understand that compensation for an injury requires a calculation to translate the severity of that injury into monetary terms. It does not compensate people for anything, any more than paying people money for anxiety makes them less anxious—it certainly does not achieve that.
Your submission says that an injury has occurred. It says:
If you are going to change the whole law on the basis of a strict interpretation of injury as something that can be a scratch, the answer is yes—I am being honest. It is some sort of injury; it is the healing process of an injury.
This is actually a legal point, so I ask Dr Hogg to speak briefly.
The question of scarring is interesting. We tend to associate a scar with a visible injury. As my submission says, the physical appearance that we present to the world is important. That is why external alterations to our bodies, such as a scar, can constitute injury, even if we do not suffer pain—although that would generally occur with a scar—and even if no physical impairment is caused.
We are not focusing on a small scratch that somebody gets at work, which could happen in any workplace. You made a point about whether there is external, visible scarring, but a pleural plaque is still a scar, albeit an internal one.
Using the word "scar" is one way to describe a pleural plaque, but it leads people to think that there must be an injury. In a pleural plaque, the cells cluster around a fibre of asbestos and, in an attempt to destroy it, they die and create a fibrous deposit. If we explain it in that way and take out the word "scar", it is less obvious, even to the layperson, that the pleural plaque should be called an injury. When we use the word "scar", it conjures up ideas of injury.
Thank you, gentlemen. That was extremely helpful.
Meeting suspended.
On resuming—
I welcome our final panel of witnesses. I apologise for the fact that you have been kept waiting for so long, but you will appreciate that the matter is important and we require to be as thorough as possible.
Good afternoon, colleagues. In written evidence to the committee, to which I have already referred, Professor Anthony Seaton refers to pleural plaques as
It seems to be a variation on the scan van idea—the idea that cases are somehow being provoked by other people such as lawyers or claims farmers. It is suggested that those people are out there trying to find people who might have been exposed to asbestos, getting them X-rayed or CT scanned to find out whether they have pleural plaques, and taking forward claims. That just does not happen, as far as our cases—and those of other lawyers whom I know—are concerned.
Professor Seaton is perfectly entitled to hold the opinion that he holds, but I do not think that it represents what the majority of medical professionals think. For the record, I have papers on plaques that I would like to hand in today. I have asked for the opinions of chest consultants, palliative care consultants and oncologists who have looked after people with plaques and other conditions.
I have worked for many years as a volunteer, including with Clydeside Action on Asbestos. To my knowledge, over the past 25 years or more, a diagnosis of pleural plaques has always resulted in compensation being paid. However, the insurers are now telling us that, in medical terms, pleural plaques are harmless and that they do no damage to the lungs. It has taken the industry quite a long time to come up with the report, given that it has paid out over all the years.
Thank you, Mr McCluskey.
It would be useful if that could be provided, Ms Craig.
Yes.
Thank you.
What difference does a compensation award make to someone who has been diagnosed with an asbestos-related disease such as pleural plaques?
First, although compensation is their only remedy, it is not the one that they want. Clients who have been diagnosed with pleural plaques because of others' negligence tell us that they want those people to be punished. The severity of their feelings is such that they would much rather that the matter was treated as a criminal offence. That option is not open to them, however; their only remedy was to pursue civil damages. Although that option was taken away, we hope that it will be restored to them. A compensation award gives people some sort of conclusion or resolution about their exposure to asbestos, although victims would much rather that the people who exposed them to asbestos were criminally prosecuted.
As a victim who was diagnosed with an asbestos-related disease—I worked as a lagger—I had to take early retirement. I previously earned a good wage, but now I cannot work. I live on the mere money that I can get from the social, which is not very much. I would certainly be worthy of any compensation that I got. It is much needed. I could then help my family out.
From a lawyer's perspective, I can say that the reaction of my clients when they win a case is that they feel that they have got some measure of justice because someone has been held to account and has had to pay some compensation that is not negligible. Although they might have reservations, they go away with the feeling that a wrong has been partially righted in some way.
Professor Seaton talked about the anxiety that is caused as a result of the legal profession's pursuit of a claim. Do you think that that is the case in respect of your firm or any other firm?
As you know, we deal with around 90 per cent of the cases and the remaining 10 per cent are dealt with by trade union lawyers and other extremely responsible lawyers. The situation in Scotland is not like that in England and Wales, which might be questionable in some respects. I do not know any lawyers who go out to farm claims. We always receive the cases from a group or a trade union or via the medical profession.
I would like to draw on your long experience of dealing with these matters. This morning, we heard, from the representatives of Norwich Union and Zurich Assurance in particular, some dramatic estimates about the number of potential claims and the implications for employer premiums as a result of the proposed change in the legislation. Based on your understanding of the number of claims coming through the system and the exposure of those and other companies, can you shed any different light on what we were told?
Anyone who wants to make a forecast or a projection should look to their existing data and should not speculate and make wild estimates. The best data that are available—there are none for England and Wales—are the data of Thompsons Solicitors, as we have dealt with most cases for a good number of years. Our database gives us quite a good basis for an estimate of how many cases we should expect to arise. In my estimate, the rate should continue to be around 200 pleural plaques cases a year. That has always been the rate. If the House of Lords decision had not gone the way that it did, I have no doubt that the rate would have continued in the coming years.
Just to put a number on it, let us assume that an insurer was responsible for 10 per cent of the claims in Scotland. What would that amount to in pounds?
Norwich Union, for example, is sole insurer for seven cases and part insurer for 13, out of a total of 567 cases.
How much would the claims be for?
The claims would be for about £5,000 for a provisional settlement and £10,000 for full and final settlement. We therefore quoted an average of £8,000. If you multiply that by eight, it is not an awful lot of money.
Mr Maguire dealt with scan vans in his response to earlier questions, so we will move straight—
Sorry, could I make a point about scan vans?
Very briefly.
The insurance industry's submissions referred to scan vans, but we have come across scan vans only from clients who have enlightened us that they were subject to X-rays carried out by their employers after their asbestos exposure. That was done to ascertain that they did not have pleural plaques although, because of the latency period, pleural plaques would not have shown up anyway. However, if pleural plaques are not dangerous, why would an employer expose people to radiation when there was no need to do so?
You have posed the question. Thank you for that intervention.
Convener, as I gave out a lot of statistics and numbers, would it be helpful to give you a schedule that provides a profile of the cases? I have not calculated percentages, but I can give them to you by e-mail if you like, although they are available from the evidence anyway.
It would save our having to calculate them if you did that.
Does your set of figures include what you regard as the state's potential liability as well as that of insurance companies?
Yes, the state liability figures are included.
That is fine. We can put that into evidence. I just wanted to check that we had both sides of the equation.
The figure for the British Shipbuilders Corporation is 16.74 per cent, but the biggest one is for the Iron Trades Insurance Group, which is basically a run-off company of Norwich Union and is not a commercial enterprise; it has a finite estate, which someone administers, but it does not get any premiums or do any business.
We heard earlier, and have just heard again to some extent, about the potential impact on premiums and on insurance companies and about the commercial nature of insurance companies. My salary and allowances are in the public domain and members around this table are well used to what we get paid being subject to public scrutiny. How do you respond to the criticism that the legal profession, rather than those who suffer from pleural plaques and the anxiety that they might bring, will be the primary beneficiaries of the bill?
Before you answer, Mr Maguire, I note that we have received a late submission from the Law Society of Scotland that details the fees. However, do you wish to augment that information?
Yes, I was going to mention that as well. Obviously, we must watch out for claims farmers and percentage claims companies that take away a swatch of someone's damages. In my firm and in other trade union firms, we separate the compensation award from the court costs. The auditor of court assesses the court costs and decides whether they are reasonable or necessary, so they are objectively referenced. Those costs include outlays for medical records, court dues, health and safety experts and medical experts. In addition, the lawyer has taken on the risk of the case being lost, which may mean exposure to tens of thousands of pounds in costs.
In your capacity as a lawyer, do you think that the bill has wider implications for the law of damages? It was suggested earlier that the bill is a fundamental assault on the founding principles of the law, which have been built up over a period.
There is a jurisprudential difference here. Dr Hogg is very much in the judicial supremacy area, which says, "Let judges get on with it. Do not interfere with them, whatever conclusions they come up with," whereas the real situation is that judges develop, interpret and apply the law. Of course, the Scottish Parliament can also legislate on issues that it perceives to be unjust or considers should be remedied. What is happening here is that the judges, through their orthodoxy, have reached a particular conclusion that is unjust. That is when an issue comes to the Scottish Parliament, for it to consider whether the result from the Scottish courts is unjust. That has happened time and again. This is not the only time that the Scottish Parliament has considered what the judges have done or have not done—this is not just civil law and criminal law—and has said, "We do not agree with that." Previously, before the Scottish Parliament, those injustices would have continued. Now that we have the Scottish Parliament, they are addressed and rectified quite speedily.
I thank Mr Maguire, Ms Craig and Mr McCluskey for giving evidence. It has been exceptionally useful and the committee is obliged to you.
I want to mention one thing. It is not only Clydeside Action on Asbestos. My friends at the back are from the Clydebank Asbestos Group, which has been actively supporting the bill from day one.
I am sure that that is the case, Mr McCluskey. Thank you.
Meeting continued in private until 13:42.
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