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Asbestos victims robbed of compensation

Asbestos cancer victims of Turner and Newall (T&N), once the world's largest asbestos company, are to be paid less than a quarter of the compensation they are due. Federal Mogul, the US owners of the company, is responsible for hundreds of cases of cancer linked to asbestos but will pay out just 24p for every pound to which victims are entitled. The US firm went into voluntary administration in 2001 using a legal process which enabled it to continue in business while ring fencing its assets and freezing its debts, including hundreds of millions in asbestos compensation liabilities. The company was among a number criticised last year by the US Environmental Working Group for using a 'business-as-usual-bankruptcy' procedure to jettison its asbestos liabilities while continuing to operate at a substantial profit (Risks 146). After four years of negotiations with representatives of asbestos victims in both the US and Britain a settlement of 24p in the pound was agreed. Solicitors Irwin Mitchell said about 50 mesothelioma victims of T&N it was representing have all died in the four years since payouts were frozen. Solicitor Adrian Budgen said that typically an asbestos victim could expect compensation of £100,000. Of this, £10,000 would have to be paid back for any industrial injury benefits received. The victim will then receive 24 per cent of the remaining £90,000 - less than £23,000. 'It is a pittance,' he said.

• Yorkshire Post and background story. EWG Federal Mogul webpages and business as usual bankruptcies webpages. Hazards asbestos news and resources.

Briefing document (300 words) issued 14 Oct 2005