§ (2) In subsection (1) omit the word "Where" and insert "Subject to the provision of section 651 A below, where".
§ "(1) Any person seeking damages
- (a) in respect of personal injuries (including any sum claimed by virtue of section 1(2)(c) of the Law Reform (Miscellaneous Provisions) Act 1934 (funeral expenses)), or
- (b) under the Fatal Accidents Act 1976 or the Damages (Scotland) Act 1976,
§ in consequence of any act or omission of a company which has been dissolved and removed from the Register of Companies shall be entitled at any time within the period permitted by the Statute of Limitations to bring or pursue such action directly against the relevant public or employer (as the case may be) liability insurers of that company who, but for the dissolution of that company, would have been contractually bound to indemnify the company in respect of that action for damages, and such insurers shall have no greater liability to that person than its contractual obligations to indemnify the dissolved company in respect of the action.
§ (2) This section shall apply to any claim or proceeding that exists at the date of or shall arise after the commencement of this Act.".'.—[Ms. Quin.]
§ Brought up, and read the First time.
Mr. Deputy Speaker
With this we shall discuss the following amendments: No. 287, in clause 131, page 141, line 36, leave out from 'time' to 'but' in line 37.
§ No. 288, in clause 131, page 142, line 1, leave out from beginning to `do' and insert—
§ '(4) An application may be made under section 651(5) of the Companies Act 1985 as inserted by subsection (3) above (proceedings for damages for personal injury, &c.) in relation to a company dissolved before the commencement of this section notwithstanding that the time within which the dissolution might formerly have been declared void under that section had expired before commencement.
§ But no such application shall be made in relation to a company dissolved more than twenty years before the commencement of this section.
§ (5) Except as provided by subsection (4), the amendments made by this section.'.
§ No. 283, in clause 131, page 142, line 2, leave out 'two' and insert 'twenty'.
§ Ms. Quin
The amendments in the name of the hon. Member for Dorset, North (Mr. Baker) are very much in line with our amendment No. 283. The issues raised by the new clause and the amendment were originally raised in Committee. We do not make any apology for raising them again on Report because they are important matters that were not satisfactorily resolved in Committee. They affect many individuals who are not only experiencing severe health problems, but find themselves in financial difficulties.
The new clause and the amendment are about the difficulty that an individual faces in claiming compensation in cases of personal injury or the contracting of industrial disease when the company for whom the individual worked has been dissolved.
We all know from cases in our constituencies just how prevalent some industrial diseases are, particularly asbestosis, pneumoconiosis, byssinosis, and so on. Those who, like me, represent an industrial constituency know the problems vividly, in particular, the physical and financial difficulties that many of our constituents are facing.
Besides ourselves, many organisations are worried about the problems that the law creates, making it so difficult for people to claim compensation, particularly when they contract diseases several years after leaving the employment of a certain employer.
I particularly want to mention the good work done by the citizen action compensation campaign in highlighting the issue. That has been rightly active in contacting 1181 members of the Committee and many other hon. Members on both sides of the House who are concerned with the issue.
The case that brought the problem to the fore is that of Bradley v. Eagle Star Insurance Company which dates from this year where it was decided that the claimant could not bring a claim against her past employers' insurance company for injuries that she alleged she had received while at work. Mrs. Bradley had contracted the respiratory disease byssinosis because of the work that she had done over several years in the card room of a Bolton cotton mill, the Dart mill.
In 1984 she brought a claim against the Eagle Star Insurance Company because her employers had gone out of business almost 10 years before. However, she could not re-register the company under the present provisions because of the two-year time limit.
Mr. John Pickering, Mrs. Bradley's solicitor, described her position as a clear injustice which was evident to any man in the street. The victim exists, the insurance company exists and the right to seek compensation for the injury has been paid for. Despite that, Mrs. Bradley was unable to obtain justice or compensation.
There is also the case of Norman Burden who worked for many years as a docker on the Newcastle quayside unloading bags of asbestos, as a result of which he contracted asbestosis. Because of the same legal difficulty, his family is left without compensation.
New clause 8 represents the optimum position. It is what we would ideally like to achieve if the Government were prepared to accept our new clause, simply because it provides for three things which do not exist at present.
The new clause would allow claimants to claim directly against the insurance company in the event that a former employee's company had been dissolved. That is important because it would overcome the problem of having to re-register the company for the purpose of making a claim against the insurer, which is the case at present and which can be a costly process—up to £400 for each re-registration.
Companies must be continually re-registered, depending on the number of claims that claimants want to make against that particular company's insurers. Some trade unions find it expensive to cope with the cost of the re-registration of companies. For example, the General and Municipal Workers Union has to re-register the Upper Clyde Shipbuilders at a cost of £3,000 or more a year. That is expensive, and if the law were changed it would be an unnecessary procedure.
The new clause also raises the issue of retrospectivity. We wish the period during which a claim can be made against an insurer to be extended from two years to 20 years. As the Bill stands, a claim can be retrospective for only two years. We feel that, especially as so many industrial diseases take a long time to manifest themselves, an alteration to 20 years would be an important step. We also wish the period to be unlimited in the future, which is why the new clause refers to the statute of limitations rather than to a 20-year period.
We hope that the Minister will respond positively. In Committee, his predecessor seemed to feel that our demands were excessive and that we should show some sympathy for the insurance companies. We were pleased to note, however, that certain Conservative Members took a rather different view, including the hon. Member for 1182 Dorset, North (Mr. Baker), although we were disappointed that that independent view was not reflected in a vote. We hope that that will not happen again.
We do not feel that the concern felt by insurers about the new clause and amendment are justified. They wrote to members of the Committee, and one point raised in Committee was that insurers, when working out the cost of their premiums, take into account that a number of companies will go into liquidation. We do not think that that complaint is justifiable, particularly as before the Bradley v. Eagle Star ruling the legal position was not really clear, and it would therefore have been very unwise for insurance companies to make such a calculation. We feel that, when premiums have been paid and claims cannot be made because of the existing legislation, the insurance companies are benefiting from a windfall.
The insurers also say that it is very unfair for them to be held liable for diseases that may manifest themselves in the future, and could not be foreseen by the industries in question. Insurance companies, however, know that that is the position—industry cannot possibly be aware of future scientific discoveries, for example—and they must deal with their customers on the basis of present knowledge.
§ Mr. Cousins
Like me, my hon. Friend the Member for Gateshead, East (Ms. Quin) represents a constituency that has had to deal with industrial diseases such as "vibration white finger" and asbestosis, which were being discussed many years ago. Workers and their trade union representatives had to fight the social security and legal systems for many years to establish the identity of those conditions—and others like them—as recognised diseases requiring compensation. Does my hon. Friend feel, as I do, anger that we should be told now after so many years of fighting that those problems could not have been anticipated?
§ Ms. Quin
I fully accept what my hon. Friend has said, and I hope that the anger that many of us feel about people who are in difficulties because of their past employment will be shared by the Minister and his colleagues.
The insurers have also said that, in certain circumstances, it may be very difficult for companies to track down the files on claimants over a 20-year period. That may be a problem, but it is not sufficient reason not to change the law. It may mean difficulties for certain claimants, but those claimants for whom records exist will be able to obtain justice.
Finally, the insurers are saying that future premiums would become more expensive if the law is changed in the way that we are suggesting, but we are reinforced in our feelings on the subject by the representations made to hon Members by Mr. Robert Kiln, an insurer with more than 50 years' experience who was an insurance adviser to the Department of Trade and Industry. He feels that any such effect would be marginal.
Another case, the Cartledge case, of which I am sure the Minister is aware, resulted in one occasion in the past where a case of retrospectivity was accepted by both sides of the House. Because of that, we urge the Minister to respond positively to our desire for retrospectivity, at least within the 20-year period, on this occasion. I urge the Minister and his colleagues not simply to accept the views of industry, but to see it from the point of view of the many individuals whose future has been blighted and who are 1183 unable to claim compensation at present. Of course it is true that no amount of money can properly compensate for a permanent loss of good health or a permanent disability, but at least we should try to create the legal conditions under which some of those who have been so badly affected can seek compensation, and by doing so alleviate the problems faced by individuals and their families.
§ Mr. Redwood
It may help the House to make progress if I intervene at this point in the debate. I have listened carefully to the hon. Lady. I know the strong views expressed by my hon. Friend the Member for Dorset, North (Mr. Baker) in previous debates. I have problems with new clause 8. They are legal difficulties with which I shall not detain the House unduly but which relate to the very point raised by the hon. Lady. Substituting the company's insurer for the company itself as the defendant to an action for damages or personal injuries poses a number of legal difficulties which the Government find difficult to accept.
However, it is much more important for the House to learn not about the legal problems but about what I propose to do about the underlying problem which has been described in Committee. I suggest that the House accepts amendments Nos. 287 and 288 in the name of my hon. Friend the Member for Dorset, North. Clause 131 already extends the two-year period to 20 years, because the Government wanted to tackle that problem. If the House accepts both my hon. Friend's amendments, I hope that it will agree that we have gone a long way towards dealing with some problems which can be quite tragic.
That would require the House to accept the principle of retroaction. When I first examined the case and read the Committee proceedings, that caused me some difficulty. I have been swayed by legal representations that I have seen in which many good lawyers suggest that on this occasion it would be reasonable. If the House is united in wanting retroaction, I shall happily accept my hon. Friend's amendments.
§ Mr. Nicholas Baker
I am absolutely delighted by what my hon. Friend has just said. I moved the amendments in Committee because it seemed to me that there was an injustice. The hon. Member for Gateshead, East (Ms. 1184 Quin) described the problem. She is more familiar with it than I am as she has more constituents affected by industrial diseases. It is clearly an injustice that people should be prevented from claiming compensation simply because a company has been dissolved. As a lawyer, I, too, was concerned about the retrospective element but medical science has advanced so much, we know so much more about industrial disease and we know that they take longer to appear. To that extent, one could argue that this is not a retrospective piece of legislation. It is recognising that there is a wrong and I am delighted that we are doing something about it.
Amendment No. 288 provides for claims to be made for up to 20 years against companies that have been dissolved. I have difficulties with direct remedies against insurers and in making the time unlimited. I think that 20 years should be sufficient.
This is a great step forward for people who have suffered industrial injuries, and I am delighted with the comments made by my hon. Friend the Minister. I hope that the House will join me in supporting the amendment.
§ Ms. Quin
I should like to welcome the comments that the Minister made. Obviously, we still favour new clause 8, but the acceptance of the 20-year period and retroactivity is a considerable victory for those who are concerned about the many cases of injustice that have occurred.
There was some confusion in Committee when we debated the amendment. The Minister's predecessor believed that the Bill's provisions would deal with the majority of cases. We subsequently realised that the Bradley case and others would not be covered by clause 131, but they will now be covered by the new formula that the Minister has accepted.
§ Mr. Redwood
I confirm that what my predecessor said was right. The amendments make small but important improvements to the original good suggestion in the clause.
§ Ms. Quin
I do not want to introduce dissent into what appears to be agreement. Mrs. Bradley's case, and others, will be dealt with effectively by the amendments, the principle of which has been accepted. I welcome that, and we will therefore not press new clause 8 to a Division. I beg to ask leave to withdraw the motion.
§ Motion and clause, by leave, withdrawn.