Causation

Once it is appreciated that the rules laying down causal requirements are not autonomous expressions of some form of logic or judicial instinct, but creatures of the law, it is possible to explain their content on the grounds of fairness and justice, in exactly the same way as the other conditions of liability. (Fairchild v Glenhaven Funeral Services Ltd, per Lord Hoffman). Discuss. - Justin Santiago

According to Lord Hoffman, the Fairchild exception was created because the alternative of leaving the claimant with no remedy was thought to be unfair. Fairchild represented a significant relaxation in the requirements for causation in claims brought by mesothelomia victims where there was more than one potential defendant. However, in providing that an employer could be liable for all of the damage in circumstances where it was by no means clear that he had caused it, the Lords arguably went too far.

The facts of the case highlight the inherent difficulty in determining which employer exposed the claimant to the asbestos dust that caused the progression of the disease and, furthermore, which employer was to be liable for causing the injury suffered.

The House of Lords addressed the appeal by considering whether, in the special circumstances of such a case, principle, authority or policy required or justified a modified approach to prove causation.

The Fairchild decision enabled a worker, who had contracted mesothelioma after being wrongfully exposed to asbestos dust at different times by more than one employer, to sue any of his former employers although he could not prove on the balance of probabilities which exposure had caused the disease. The House of Lords held that, following McGhee v. National Coal Boardthe appropriate test in this situation, was whether the defendant had materially increased the risk of harm toward the plaintiff. The employers were joint and severally liable against the plaintiff (though amongst themselves they could sue one another for different contributions).

Fairchild allowed the claimant to succeed against more than one employer by providing that any one might have increased the risk if diseae without actually proving exactly when or where the exposure took place. The justification for the joint and several liability rule is that if you caused harm, there is no reason why your liability should be reduced because someone else also caused the same harm. As a result of Fairchild, insurers were potentially liable for large claims in circumstances where their insured’s were not actually responsible for the damage. Furthermore, given that mesothelioma is a condition that is usually latent for around 30 or 40 years, the chance of recovering a contribution from other defendants/their insurers was materially reduced, either because of the inherent difficulties in tracking them down or because of the increased likelihood that they/their insurers had become insolvent.

This a radical departure from the usual test of causation and reversing the normal burden of proof once a prima facie case of increased risk was made out – it was then for the employer to show that he was not at fault overturning Wilsher v Essex AHA where the reversal of the burden of proof was rejected.

Barker v. Corus [2006] UKHL 20 Barker went some way towards redressing the balance in Fairchaild. In Barker v Corus the claimant had been exposed to asbestos by two separate employers and for a period when he was self-employed.
This time the question was whether, if one of the employers that was responsible for the materially increasing the risk of harm had gone insolvent, should the solvent employers pick up the proportion for which that insolvent employer was responsible? The House of Lords accepted the argument that the solvent employer should not and would only have to pay one third of the full compensation. In other words, he only had "proportionate liability". In this case where liability was exceptionally imposed because you the employer may have caused harm fairness suggests that if more than one person may have been responsible, liability should be divided according to the probability that one or other caused the harm.

Shortly after the Compensation Act 2006 was introduced specifically to reverse the ruling. However the Act only applies to asbestos related disease. The government’s proposed legislation, while undoubtedly welcomed by the victims of this terrible disease, has the potential to wreak havoc in the insurance industry and destroys the balance of justice as a result of Barker.

The legislation effectively reinstates the position in Fairchild whereby an employer/his insurer(s) can be sued for the full amount. Insurers will now be forced to pursue subrogated proceedings against other negligent employers/their insurers where they can be traced, leading to potentially protracted litigation. Insurers might also face recovery issues regarding their outwards reinsurance depending on the terms of their reinsurance cover.

So who is the law fair to now? The claimant or the 'possible' defendant?