Read this article in:
11 August, 2005ICEM News release No. 2/2002
After years of campaigning, 7,500 South Africans suffering from asbestos-related diseases have reached a settlement with asbestos multinational Cape plc.
Agreed out of court in December, the settlement terms are complex, but the main points are:
- Cape will pay a total of £21m sterling (about €33.8 million or US$30.2 million) into a Trust fund to be established in South Africa which will make payments to those who can show that they have suffered from asbestos-related disease ("ARD") as a result of working at, or living in the vicinity of, one of Cape's former mining, milling, or manufacturing operations in South Africa.
- The Trust scheme will be available to sufferers involved in the legal action which the South African victims brought against Cape in England, where the multinational is headquartered, but also to anyone else who can satisfy the Trust conditions, including relatives of deceased victims of ARD.
- Payments, according to the severity of the asbestos-related diseases, will be:
for mesothelioma, about £5250 total maximum (about €8456 or $7552)
for asbestosis about £3250 total maximum (about €5235 or $4675)
for pleural thickening/pleural effusion about £1600 total maximum (about €2577 or $2302)
for pleural plaques about £700 total maximum (about €1127 or $1007).
- The first £11m will be paid by 30 June 2002 provided various conditions are satisfied. One condition is that the South African government confirms that it will not fund future legal claims against Cape and that it does not pursue Cape for any cost of rehabilitating its former asbestos mines. Another condition is that Cape obtains the approval of its bankers and shareholders for the deal and that is able to raise the necessary finance. The other £10m will be paid into the Trust by Cape over a period of 10The South African victims would probably have been awarded "considerably more than 20 million pounds" if the case had gone to trial in England this year as scheduled, their British lawyers say. However, "it seemed clear that Cape's financial position is such that it would go into liquidation if it lost the trial. In those circumstances, the only real achievement might have been to set another legal precedent, with the victims receiving virtually nothing.
The South African victims would probably have been awarded "considerably more than 20 million pounds" if the case had gone to trial in England this year as scheduled, their British lawyers say. However, "it seemed clear that Cape's financial position is such that it would go into liquidation if it lost the trial. In those circumstances, the only real achievement might have been to set another legal precedent, with the victims receiving virtually nothing.
"Central to the claimants' case," the lawyers added, "is the principle that multinational companies undertaking hazardous operations overseas in breach of domestic health and safety regulations should be legally responsible for resultant injuries. The settlement is a salutary warning to multinationals generally against 'double standards'."
But for at least 300 of the South African claimants, the settlement came too late. They died during the seven years of wrangling with Cape.
Although Cape paid compensation to its British former asbestos workers, it persistently refused to meet the South Africans' claims. It also tried to block moves to have the South Africans' case heard in the English courts. The company's attitude changed towards the end of last year, following a boardroom coup. On 1 November, the Montpellier Group increased their stake to 29.9 percent, making them Cape's biggest shareholder. Michael Langdon, the previous Chairman of Cape, then stood down and was replaced by Montpellier's Managing Director, Paul Sellars.
As well as fighting the case through the English courts, the asbestos victims were backed by many campaigning organisations, including the 20-million-strong International Federation of Chemical, Energy, Mine and General Workers' Unions (ICEM), its South African affiliate the National Union of Mineworkers (NUM), and ICEM-affiliated British unions.
Cape mined asbestos in South Africa for almost a century. "Children were employed, unprotected, in the most hazardous tasks of sorting asbestos with their bare hands and trampling it with their bare feet," recalled ICEM General Secretary Fred Higgs in letters to Montpellier and other major shareholders just before the boardroom shake-up. "Due to the atrocious conditions at the mines and mills," Higgs wrote, "thousands of South Africans developed the fatal asbestos cancer, mesothelioma, and the debilitating disease of asbestosis."
In South Africa, the NUM's Archie Palane said the Cape case "should offer a valuable lesson to those companies who continue this form of inhumane exploitation today." He added that the NUM "would like to see the establishment of industry-wide compensation funds that mean that workers do not have to fight protracted legal battles like this one."