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Supreme Court decision in the textile deafness litigation

The Supreme Court has handed down Judgment in the first noise induced hearing loss claim to reach either the House of Lords or the Supreme Court.

The Supreme Court has handed down judgment in the first noise induced hearing loss claim to reach either the House of Lords or the Supreme Court.

The judgment marks the beginning of the end of a journey which commenced in 2002 with the intimation of an initial tranche of NIHL claims against textile employers and insurers. This initial tranche mushroomed into several thousand claims worth tens of millions of pounds.

Weightmans LLP instructed by Zurich Insurance acted for the lead Appellants – Quantum Clothing Group.

Background

Consequent to the many hundreds of claims litigated out of the Nottingham County Court and several thousand pre litigated claims, the court sought to collectively case manage these cases in what was known to be the 'Notts & Derbyshire Textile Deafness Litigation'. A group of 10 test cases were selected to proceed in the Nottingham High Court commencing September 2006. The court heard 5 weeks of evidence from over 100 lay witnesses, several acoustic engineers and ENT consultants.

The legal argument

Employers in the 1960s, 70s and 80s applying standards described in Noise and the Worker(1963) and the Code of Practice on Noise (1972) understood that they were required to protect employees where noise levels exceeded 90 dBA (Lepd).

The claimants' argument before the High Court was that these employers ought to be held liable for the failure to provide hearing protection from 1963 at levels below 90 dBA (Lepd), indeed as low as 80 dBA (Lepd) on the basis that those official documents both identified that exposure to levels of noise below 90 dBA (Lepd) could cause deafness to some susceptible individuals.

Had the claimants' arguments found favour, the floodgates would have been opened with claims potentially emanating from virtually every person whoever worked in manufacturing industry and who had developed some degree of hearing loss since 1963.

High Court judgment

All 10 High Court test cases were dismissed in a judgment of His Honour Judge Inglis at Nottingham High Court [February 2007]. This included the claim brought by Stephanie Baker.

Quantum Clothing was found not to be in breach of their duty of care either at common-law or under statute, because they did not expose the claimants to noise levels exceeding 90 dBA (Lepd). The judge did, however, find that Mrs Baker had developed some degree of hearing loss on her left side in addition to mild tinnitus.

The claimant appealed with a revised argument seeking to impose liability on employers to provide hearing protection to employees at levels at or above 85 dBA (Lepd) from 1972. That appeal was heard by the Court of Appeal (Smith LJ, Sedley LJ and Jacob LJ).

The Court of Appeal found (by its judgment of May 2009), that there was a duty upon employers to act from 1 January 1978 at levels at or above 85 dBA (Lepd). Section 29(1) brought with it a duty on the part of the occupiers/owners to make a claimant's place of work 'safe'. The Court of Appeal, applying Larner v British Steel, felt that the meaning of 'safe' should not be qualified by reasonable foreseeability nor indeed was it to be viewed in the context of the practice of employers and industry at the time.

Our appeal was mounted against the Court of Appeal's Judgment with the Court hearing oral submissions between the 22 and 24 November 2010.

The Supreme Court result

By a majority (Lords Mance, Dyson and Saville), the Supreme Court allowed our appeal (Lords Kerr and Clarke dissented).

To all intents and purposes, the Supreme Court reinstated the judgment of His Honour Judge Inglis in the Nottingham High Court, holding that:

  • The appellant (Quantum Clothing Group), was not in breach of its common-law duty of care towards the claimant (respondent).
  • Quantum Clothing Group, did not possess 'special' knowledge and had no duty to act at levels of 85 dBA (Lepd), prior to the introduction of the Noise at Work Regulations [1989].
  • Although the Supreme Court held that the Factories Act [1961] and specifically Section 29(1) could apply to 'noise', the appellants were not in breach of Section 29 (1) for relying upon the main thrust of the 1972 Code of Practice on 'noise' and were thus not in breach of their statutory duty for failing to provide hearing protection for those employees exposed at levels between 85 and 90 dBA (Lepd) before the 1 January 1990.

Ramifications for the insurance market and NIHL claims handling

  • Had the claimants been successful in either their original or revised arguments that liability should attach at levels below 90 dBA (Lepd) before the 1 January 1990, all historical employers' liability insurers would have faced increased financial liability, running into tens of millions of pounds.
  • One long lasting legacy of this case will be the 'Judge Inglis causation test' (set out in his 2007 Judgment), which stipulates a more robust diagnostic test for noise induced hearing loss claims. That test would have stood irrespective of the outcome of our appeal. It has, however, become widely recognised as a benchmark for causation in noise induced hearing loss claims and sets a higher standard of proof than previously established.
  • The result should be seen in the wider context as a discouragement against other 'claims farmers' keen to push the boundaries of the law.

In summary, we view the Supreme Court's decision as a 'victory for common-sense' and a welcome restatement of the law which governs noise induced hearing loss claims handling.

Discontinuances consequent to the decision in 'Baker'

Following the Judgment in the case of Baker v Quantum Clothing Group & Others (2011), covered above, we have started to see discontinuances start to arrive on those cases stayed pending the outcome.

Some claimant's solicitors appear to be advising that no ATE Insurance is in place in respect of the claimants they act for and are pressing for 'drop hands' type discontinuances. However, the case of Adris & Others v Royal Bank of Scotland & Others (2010) should be borne in mind. This case provides authority to seek costs directly against claimant's solicitors where they have failed to ensure adequate funding and costs protection is not in place for their clients.

The result will undoubtedly see fewer noise induced hearing loss cases being brought in the first place and will impact upon other long tail diseases such as HAVS. This judgment along with the still difficult market times are sure to lead to some of the smaller niche Claimant's firms going out of business and indeed we have recently seen one South West firm go into administration.