Overseas asbestos exposure - to pay or not to pay? | Asbestos Injuries Compensation Fund Limited as Trustee for the Asbestos Injuries Compensation Fund [2018] NSWSC 589

The late Mr Talifero (Mr Talifero) commenced proceedings against Amaca Pty Ltd (Amaca) alleging that, as a result of his exposure to asbestos dust and fibre emanating from asbestos cement products manufactured by Amaca, he had contracted mesothelioma.

In Mr Talifero's Statement of Particulars he provided a summary of his work history and exposure to asbestos. Mr Talifero provided details of his exposure to asbestos dust and fibre while employed overseas in the United Kingdom.

On 11 December 2017, Judge Russell SC delivered his reasons in David Talifero v Amaca Pty Ltd [2017] NSWDDT 14 and also ordered judgment in favour of Mr Talifero against Amaca for $560,482 plus costs.

The Asbestos Injuries Compensation Fund Limited (The Trustee) made an application for judicial advice to determine whether the Trustee would be justified in not paying so much of the damages awarded by Judge Russell SC as reflects the extent to which Mr Tailfero was exposed to asbestos outside Australia.

Mr Talifero's estate argued that the Trustee should be advised that it was required to pay the whole of the liability of Amaca under the judgment given by Judge Russell SC. It argued that refusal to do so amounted to a breach of the Final Funding Agreement and the Trust Deed.
 

The Trustees submitted that the definition of “personal asbestos claim” in the James Hardie Former Subsidiaries (Winding up and Administration) Act 2005 NSW (the 2005 Act), was ambiguous. It was then argued that the Asbestos Injuries Compensation Fund Amended and Restated Trust Deed dated 14 December 2006 (the Trust Deed) and the Amended and Restated Final Funding Agreement dated 21 November 2006 (Final Funding Agreement) confirmed that the only types or kinds of liability that may be paid by the Trustee or the liable entity were those arising from exposure to asbestos that occurred wholly within Australia or, in cases where the individual has been exposed to asbestos within and outside of Australia, any damages awarded in relation to that claim were limited to the amount attributable to the exposure in Australia.

In making this determination, Justice Sackar undertook the task of construing the 2005 Act, the Trust Deed, and the Final Funding Agreement.

Justice Sackar found that while there was some ambiguity and disconformity between the three documents, the documents were intended to operate together and a harmonious reading of the various related terms was essential.

Mr Talifero's estate submitted that the whole of Mr Talifero's claim was in relation to Australian exposure and not overseas exposure; it argued that the whole of the damages awarded by Judge Russell SC was in relation to Australian exposure and therefore the Trustee was obliged to pay the whole of the judgment awarded by Judge Russell SC.

It was further submitted that while Mr Talifero was exposed to asbestos dust and fibre during his employment in the United Kingdom, his claim did not rely on this exposure in his pleadings and therefore did not fall within the definition of “personal asbestos claim” in the 2005 Act.

Justice Sackar was not of the view that the word "claim" in the 2005 Act, the Final Funding Agreement or the Trust Deed, was intended to be confined to the pleadings. While acknowledging that mesothelioma is an indivisible disease and the legal test of causation in such matters, Justice Sackar said that:

Justice Sackar held that the Trustee was only obliged to pay those personal asbestos claims as limited to the amount attributable to the proportion of the exposure which caused or contributed to the loss or damage which occurred in Australia.

The question of the proportion of the overseas exposure was left open by Justice Sackar, who observed that the medical evidence can determine whether the overseas exposure made a material contribution toward the mesothelioma.
 

Plaintiffs who seek damages for an indivisible disease, and have had exposure to asbestos dust and fibre overseas, may now refrain from suing Amaca Pty Ltd as a Defendant, if they are able to sue another Defendant, to avoid the risk of their damages being reduced in light of the Trustees' inability to pay the overseas proportion of the asbestos exposure.

While the above approach may result in the Plaintiff obtaining 100% of his damages, it may leave a Defendant, or Cross Defendant, who claims a contribution from Amaca in a position where its claim for contribution from Amaca will not be satisfied in full by the Trustees.