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Parent company liable for asbestos claim
In April 2012, an important ruling by the Court of Appeal decided for the first time, that a parent company owed a direct duty of care to a victim of asbestos-related disease who was employed by a subsidiary. The parent, Cape PLC, was not held liable just because it was a parent company. However, the Court provided a checklist of the circumstances that may trigger responsibility by a parent company for the health and safety of employees of the subsidiary. As the case has general importance for all workers injured or made ill as a result of an employer’s breach of health and safety law, these factors are listed in Chapter 1: Common Law.
In this case, the claimant, Mr Chandler, was exposed to asbestos while working in a brick manufacturing business in the late 1950s and early 1960s. By the time he developed asbestosis, his old employer no longer existed. There was no insurance policy in place over the period of exposure to respond to the claim. The Court heard evidence that the parent company, Cape PLC, maintained some control over the subsidiary’s business and was fully aware of systemic failures on site that allowed asbestos dust to escape. The parent company knew about the risks to health this triggered. It involved itself in health and safety issues at the subsidiary and had superior knowledge about the nature and management of asbestos risks. The Court decided that the parent company was in breach of a duty that it owed to the employees of the subsidiary because it failed to advise the subsidiary what steps should be taken to create a safe system of work and failed to ensure that those steps were taken.
Chandler v Cape PLC [2012] EWCA Civ 525