House of Lords' Victory for Human Rights 

by Laurie Kazan-Allen



A House of Lords' ruling on July 20, 2000 opened the English courts to foreign plaintiffs injured by the overseas operations of British companies and their subsidiaries. Three thousand South African claimants in the case of Schalk Willem Burger Lubbe et al were given leave to continue legal actions in a landmark case which has taken over three years to work its way through the judicial system. The defendant, Cape plc, had been desperate for the cases to be dealt with by the South African judiciary and offered the Centre for Applied Legal Studies in Johannesburg 2.5 million Rands (R) to represent the victims. In a unanimous judgment, five Law Lords found that: "if these proceedings were stayed in favour of the more appropriate forum in South Africa the probability is that the plaintiffs would have no means of obtaining the professional representation and the expert evidence which would be essential if these claims were to be justly decided. This would amount to a denial of justice." The verdict in the Lubbe case is a stunning reversal of fortune for Cape, a multinational conglomerate domiciled and incorporated in England, with an annual turnover of £240 million and net assets of £54 million. Cape has, in the past, succeeded in exploiting jurisdictional issues to its advantage. A product liability lawsuit brought by American workers against NAAC, Cape's North American marketing subsidiary, failed in 1988 because the English Court of Appeal refused to enforce a $15.6 million default judgment issued by a United States District Court in Tyler, Texas. There is an important difference between the US and South African cases. In the earlier case, Cape refused to submit to a foreign court's jurisdiction; in the later it has "agreed to submit to the jurisdiction of the South African court in respect of the claims." The strategy behind the company's change of tack is obvious: it had little to lose by appearing in South Africa where legal aid for personal injury cases is unobtainable and lawyers would be unlikely to fund such complex and time-consuming cases on a contingency basis. It had everything to lose in the UK forum where legal aid had been awarded and the firms of Leigh, Day & Co. and John Pickering & Associates, experienced in class actions and asbestos litigation, were acting for the claimants. The progress of the Lubbe case was closely monitored by lawyers from T&N Ltd., the current incarnation of Turner & Newall Ltd., an enterprise which dominated the UK asbestos industry and, at times, rivalled the US giant Johns-Manville. Hundreds of asbestos cases from Swaziland, Zimbabwe and India, which had been dormant during the Cape appeal, will now move "ahead with speed towards trial" in the UK.

From the start, the plaintiffs in the Lubbe case faced almost insurmountable hurdles including jurisdictional problems and evidentiary difficulties. On appeal, the five plaintiffs in the first action won the right to sue in England. On December 16, 1998, the House of Lords confirmed that the cases of Rachel Lubbe et al could proceed. One month later, writs alleging occupational or environmental exposure were issued on behalf of Hendrik Afrika, Cupido Adams and 1,537 others. The increase in numbers was the basis for another defence application to stay proceedings "so that the claims could be returned to South Africa as a group action." This manoeuvre succeeded. On July 30, 1999, Mr. Justice Buckley found: "The operation of asbestos mines and mills in South Africa appears to have caused wide-spread injury, suffering and death over many years. An enquiry into the circumstances including, local standards, conditions, regulations and state of knowledge of the parties and, if appropriate, assessment of damages to compensate the South African victims are overwhelmingly matters in which the South African jurisdiction has far greater interests." Writing the seventeen page House of Lords Judgment, Lord Bingham of Cornhill noted: "public interest considerations not related to the private interests of the parties and the ends of justice have no bearing on the decision which the court has to make." The South African government, which had taken the unusual step of making a submission directly to the Lords, was delighted with the verdict saying: "The allegations against Cape did not take place in a legitimate legal system and the new South African Government cannot afford to determine every wrong of the old regime through its judicial system. The discriminatory health and safety laws, which left South African workers unprotected, or significantly, underrepresented, against known risks as a matter of South African law were against the law of humanity." According to Richard Meeran, the English solicitor representing the majority of the plaintiffs: "The House of Lords' decision is a victory for justice and has signalled a new era both in terms of legal accountability of multinationals and the protection of human rights by the English courts." Speaking in London, Northern Cape Environment Minister Thabo Makweya was delighted with the result: "We can't allow the multinational companies to get away with murder." Makweya also said that the South African government was now working with the lawyers and campaigners "to ensure that the speediest resolution of this case is found." Aditi Sharma from ACTSA (Action for Southern Africa) pledged to continue the campaign: "We see this as vindication after three years of legal wrangling. We will now begin the battle for compensation itself, and will continue to pressure shareholders, consumers and clients so that Cape delivers compensation as speedily as possible." Emphasizing the legal implications for other UK corporations, one anonymous UK lawyer warned that: "for multinationals to be susceptible to litigation in their home country is a disincentive to invest (abroad). There are a number of multinationals out there who are probably feeling slightly uncomfortable."

Cape, formerly the UK's second biggest asbestos group, and its subsidiaries had mining, milling and manufacturing operations in the Northern Cape, the Northern Province and Gauteng. Cape Asbestos Company Limited was incorporated in England in 1893: "to purchase, take on lease, hire or otherwise acquire any asbestos or other mines, quarries, workings, rocks...containing or supposed to contain asbestos or other minerals in South Africa, Canada, Italy or elsewhere and in particular to acquire...and turn to account the Farms Kogas Hounslow, Schalkdrift and certain mining rights over the Farm Schalkputs, all situate in the district of Hay, Griqualand West, in the Colony of the Cape of Good Hope, in South Africa." According to an official government report of 1915: "the history of the asbestos industry in the Cape has been...practically that of the Cape Asbestos Company." For over fifty years, Cape's crocidolite (blue asbestos) mine at Koegas and mill at Prieska in the Northern Cape Province provided employment for local residents. In 1925, Cape acquired the Penge amosite mine and mill in the Northern Transvaal. Asbestos products were manufactured at the company's factory in Benoni, near Johannesburg from 1940. Although the corporate structure of the defendant's group was changed in 1948, the plaintiffs allege that control of the South African operations was exerted by the parent company which "knowing (so it is said) that exposure to asbestos was gravely injurious to health, failed to take proper steps to ensure that proper working practices were followed and proper safety precautions observed throughout the group. In this way, it is alleged, the defendant breached a duty of care which it owed to those working for its subsidiaries or living in the area of their operations (with the result that the plaintiffs thereby suffered personal injury and loss)."

Cupido Adams knows about Cape's working conditions. Like one in seven people from his home-town of Prieska, he has asbestosis. In his seventy-two years, he has watched his wife, parents and brothers die of the same disease. The fact that he is ill comes as no surprise to Mr. Adams; he remembers all too clearly working with the deadly dust all day and every day. In the absence of protective gloves, he handled and sorted asbestos with his bare hands: "The dust was everywhere. It lay up to an inch thick. There were no warnings, nothing. Children played in it. I lived half a kilometre from the factory but in order to drink I had to scrape a layer of asbestos off the top of my water jug." The situation in which Cape's former workers find themselves is a far cry from that promised during the company's heyday. In 1953, a publication issued on the occasion of Cape's Diamond Jubilee predicted a glowing future for its workforce: "Cape's achievement is no more and no less than the total contribution of every member of the Company over these sixty years... recognising this fact (we) have seen to it that the first to benefit from prosperity, when it came, were the employees in mine and factory, laboratory and office, at home and abroad." The text stressed the "magnificent work done by the men and women in our mining establishments." In 1979 when Cape sold up and left its former workers to fend for themselves, no settlement was made, no trust set up, no medical scheme was put in place. Cape has not paid one rand in compensation to any of its South African workers; half a century later, these men and women are struggling to obtain a fraction of the compensation their UK counterparts have received. The company has not contributed to South African efforts to decontaminate the asbestos dumps, industrial sites and derelict mines it left behind. Levels of environmental pollution in some regions are colossal; eighty-two asbestos dumps in the Northern Cape have been identified. Hendrik Naude, an official in the Department of Minerals and Energy, estimates that R100 million more will be needed to rehabilitate asbestos dumps. He says: "I have no idea where we are going to get the money from; we are competing for money with essential sectors like housing, education and health." Estimates that it will take fifteen years to finish the task are unacceptable: "this is too long…every day that we wait is a day that someone may be exposed to danger," he said.

Cape's operations were world-wide. In the mid-1970s the company boasted that it was "one of the principal producers of crocidolite and the world's chief producer of amosite asbestos." Cape and its subsidiaries had holdings in South Africa, Italy, France and Germany. At Cape's facilities in London, Hebden Bridge, Uxbridge, Manchester, Glasgow, Newcastle, Liverpool, Belfast and the Isle of White, asbestos from its South African mines was turned into a wide range of products including asbestos yarn and cloth, millboard, webbing, insulation mattresses, pre-formed thermal insulation, sprayed asbestos thermal and acoustic insulation, filtration materials, asbestos cement flat sheets, corrugated sheets, pipes, moulded products, slabs, packings and rope lagging. Evidence of Cape's attitude towards health and safety issues can be found by looking at the operations at its Barking, East London factory; even by the standards of the day, this factory was considered to be a particularly "dirty" (i.e. dusty) operation. Extracts from reports by C. Leonard Williams, the Medical Officer of Health for Barking Town Urban District Council, are illuminating: "the presence of asbestos dust in the lungs produces a definite disability… decreasing the expectation of life… that the conditions under which certain of these cases have been working have been such as to permit the inhalation of asbestos dust, with consequent pulmonary disability." Williams reported three cases of asbestosis from the Barking factory in 1929. In 1945 he sadly reported that: "I am firmly of the opinion (that) it (asbestos) is a deadly and dangerous commodity, and that unless those who are charged with the responsibility of safeguarding the health of the people in the industry can give positive assurances that they have now after all these years removed every possible danger, the processing of asbestos, except so far as its products are essential to the national economy, should be barred." In 1960, a paper was published in England which documented the relationship between environmental exposure to asbestos and mesothelioma. Mesothelioma of the Pleura and Peritoneum Following Exposure to Asbestos in the London Area concluded that: "Among those with no evidence of occupational or domestic exposures, 30.6% of the mesothelioma patients and 7.6% of the in-patients with other diseases lived within half a mile of an asbestos factory." This factory belonged to Cape. Long after information was available in the UK, Cape's South African workers continue to receive occupational and environmental exposures which have resulted in the levels of death and disease we are now witnessing. Ngoaka Ramatlhodi, Premier of the Northern Province, home to many of the asbestos plaintiffs, expressed the sentiment of many health and safety campaigners when he said: "Globalisation of the world economy must be accompanied by globalisation of human rights." The House of Lords' decision may herald a time when discredited processes and methods of production can no longer be transferred from the West to developing countries; companies which continue to disregard the health and safety of their workers will (finally) be called to account.

August 15, 2000



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