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Monday, 16 March 2015

When is a Disease not a Disease?

When is a disease not a disease? 

When it might cost insurers money – appears to be the answer in view of the arguments put forward in the case of Dalton v British Telecom which was decided in the High Court last week.

This was not simply an academic argument. Claims for damages for Noise Induced Hearing Loss (NIHL) are the most common Occupational Disease claims. Under rules which were in force until April 2013, insurers had to pay a ‘success fee’ where a case was funded by under a Conditional Fee agreement. This involves percentage uplift to the claimant’s lawyers’ fees. In a disease case the uplift was 67.5%. in an injury case it was 25%. So in the Dalton case, and others, insurers sought to argue that hearing loss is an injury and not a ‘disease’, thus reducing the amount they had to pay. Although those rules have now gone, there are still hundreds of claims being pursued under them i.e. which started before April 2013.

Their argument was that Hearing Loss is not a ‘disease’ as such but an injury caused by some external factor i.e. noise.

In all of my 30 odd years as a solicitor this has never been argued by anybody. In fact the consensus in relation to NIHL claims goes back a lot longer than that.

In a very detailed judgment, Mr. Justice Phillips firmly rejected the insurers’ argument. 

The key point is that hearing loss is caused by exposure over a period of time rather than a single incident. The judge noted that – “...the term ‘disease’ has been used in legislation relating to employers’ liability claims and insurance since 1906 ….to cover conditions (including injuries) which have arisen by process rather than by accident.”

He then noted the 1985 Prescribed Disease Regulations which specifically referred to Occupational Deafness as – “the disease numbered A10 in part one of schedule 1 to the Regulations." 

The judge also noted that the Protocol for Occupational Disease claims that was published in 2003 defined a disease a follows –

‘..any illness physical or psychological, any disorder, ailment, affliction, compliant, malady or derangement other than a physical or psychological injury caused by an accident or other similar single event.’

Then there were negotiations including insurers, which resulted in the fixed ‘success fees’ which were at the heart of this case. Those discussions led to data which formed the basis of a report in 2004 entitled Calculating Reasonable Success Fees in Employers Liability Disease Claims. The report included NIHL as the third largest category of disease.

The judge found that NIHL was, by any sensible reckoning,  a disease – ‘NIHL is not merely an occupational disease, but it is the paradigm case of such a disease.’
The judge went on to criticise the conduct of the insurers who appeared to be going back on what they had agreed in 2005. He described their arguments as ‘an opportunistic attempt to avoid part of the overall bargain..’

It is comforting to lawyers and victims of disease claims that this argument has been so decisively rejected. It shows again the lengths to which insurers will go to avoid or minimise their liability. This is an attitude which has underpinned many attacks on victims over the last few years.

The insurers could still appeal but the hope is that they will see this hopeless argument for what it was and let us all get on with the job of securing proper compensation for victims.

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