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Cite as: [2018] CSOH 25, [2018] ScotCS CSOH_25

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OUTER HOUSE, COURT OF SESSION

PD2099/14

[2018] CSOH 25

OPINION OF LORD TYRE

In the cause

GEORGE DOCHERTY and OTHERS

Pursuers

against

SECRETARY OF STATE FOR BUSINESS,INOVATION AND SKILLS

Defender

Pursuers: Marshall, (sol adv); Thompsons

Defender: O’Brien QC; Clyde & Co

21 March 2018

Introduction

[1] Where a man, while working in Scotland, inhales asbestos fibres that cause injury to

his body after he has become resident in England, which law is applicable to determine the

admissibility of claims for damages made by his executors and relatives after his death?

[2] Mr James Docherty (“the deceased”) died on 30 September 2011. A post mortem

examination disclosed the presence of pleural plaques and indicated levels of asbestos

exposure generally associated with asbestosis. It is averred by the pursuers that the

deceased was a mechanical fitter who served an apprenticeship with Scotts Shipbuilding

and Engineering Company in Greenock (for whose liabilities the defender is now

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responsible) from about 1941 to 1947, during which time he was exposed to inhalation of

asbestos dust. Between 1954 and 1979 the deceased worked for Imperial Chemical

Industries Ltd (ICI) at their plant in Teesside, during which time he was again exposed to

quantities of asbestos dust. In about 2003 he began to experience respiratory symptoms and

continued to suffer from chest problems from time to time thereafter. In September 2009 he

was admitted to hospital in Middlesbrough, where a CT scan showed inter alia basal

bronchiectasis with fibrosis and mild pleural thickening. He continued to suffer respiratory

difficulties until he died in 2011.

[3] The present action for damages was raised in 2014 by the deceased’s widow, as an

individual and as the deceased’s executrix nominate, and by 23 other relatives of the

deceased. The deceased’s widow has since died and her executors have been sisted in her

place. They are also now the executors of the deceased. Liability is not admitted.

[4] At the time when he began to experience respiratory symptoms, at the time of

diagnosis and immediately prior to his death, the deceased lived in England. As the

solicitor advocate for the pursuers acknowledged, the present action was raised in Scotland

with a view to benefiting from the Damages (Scotland) Act 2011 which allows rights of

action to relatives who would have no claim under English law. It is a matter of agreement

that the only claims made in the present action that would be competent under English law

are (i) the executors’ claim for the deceased’s non-pecuniary loss prior to his death,

including loss of expectation of life; (ii) the executors’ claim for the care provided by

relatives to the deceased during his illness; and (iii) the deceased’s funeral expenses.

[5] Following a Procedure Roll debate at which the present defender was not

represented, Lord Boyd of Duncansby held ([2015] CSOH 149) that the action in so far as

directed against ICI was irrelevant because it had proceeded under Scots law. The locus

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delicti was England, and Scots law as lex fori did not recognise any specific right of action

which was denied to the pursuer by the lex loci delicti. Lord Boyd put the case out by order

to enable the pursuers to consider a minute of amendment to introduce a claim under the

relevant English legislation. A minute of amendment was duly prepared, and at the by

order hearing, the pursuer moved for amendment of the pleadings in terms of the minute of

amendment and answers thereto by the then first and second defenders. Amendment was

opposed by both defenders and, following a further hearing, Lord Ericht refused to allow

the amendment to be made (see [2017] CSOH 54). By interlocutor dated 29 March 2017,

Lord Ericht dismissed the action in so far as directed against ICI. He declined, however, to

accede to a motion by the present defenders to dismiss the action against them, expressing

the view that the appropriate place for such a discussion would be a debate on the

Procedure Roll. Since then the pursuers’ pleadings have been allowed to be amended to

insert a claim by the executors against the present defenders on the hypothesis that the

applicable law is English law. The pursuers, however, maintain their primary position

which is that so far as these defenders are concerned, the applicable law is the law of

Scotland. The case came before me on the Procedure Roll for debate of this matter.

The issues

[6] Three issues were debated before me:

(i) Whether the applicable law is determined by the Rome II Regulation (no

864/2007) on the law applicable to non-contractual obligations;

(ii) If so, what is the applicable law under the Regulation; or

(iii) If not, what is the applicable law under the common law of Scotland.

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The Rome II Regulation

[6] Recitals 15, 16 and 17 of the Regulation state:

“15. The principle of the lex loci delicti is the basic solution for non-contractual

obligations in virtually all of the Member States, but the practical application of the

principle where the component factors of the case are spread over several countries

varies. The situation engenders uncertainty as to the law applicable.

16. Uniform rules should enhance the foreseeability of court decisions and ensure

a reasonable balance between the interests of the person claimed to be liable and the

person who has sustained the damage. A connection with the country where the

direct damage occurred (lex loci damni) strikes a fair balance between the interests of

the person claimed to be liable and the person sustaining the damage…

17. The law applicable should be determined on the basis of where the damage

occurs, regardless of the country or countries in which the indirect consequences

could occur. Accordingly in cases of personal injury or damage to property, the

country in which the damage occurs should be the country where the injury was

sustained or the property was damaged respectively.”

[7] Chapter II of the Regulation is concerned with “Torts/Delicts”. Article 4, entitled

“General rule”, provides inter alia as follows:

“1. Unless otherwise provided for in this Regulation, the law applicable to a non-

contractual obligation arising out of a tort/delict shall be the law of the country in

which the damage occurs irrespective of the country in which the event giving rise to

the damage occurred and irrespective of the country or countries in which the

indirect consequences of that event occur.

…

3. Where it is clear from all of the circumstances of the case that the tort/delict is

manifestly more closely connected with a country other than that indicated in

paragraph 1 or 2, the law of that other country shall apply. A manifestly closer

connection with another country might be based in particular on a pre-existing

relationship between the parties, such as a contract, that is closely connected with the

tort/delict in question.”

In terms of article 2(3), “an event giving rise to damage” includes events giving rise to

damage that are likely to occur, and “damage” includes damage that is likely to occur.

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[8] Article 25(1) provides that where a state comprises several territorial units with their

own rules of law in respect of non-contractual obligations, each unit shall be considered as a

country for the purposes of identifying the law applicable under the Regulation. Under

article 25(2), a member state is not obliged to apply the Regulation to conflicts between its

own legal systems. The United Kingdom has, however, chosen to do so. The Law

Applicable to Non-Contractual Obligations (Scotland) Regulations 2008 (SI 2008/404)

provide (reg 3) that the Regulation shall apply in the case of conflicts between the laws of

different parts of the UK as it applies in the case of conflicts between the laws of other

countries. SI 2008/2986 contains an equivalent provision for England, Wales and Northern

Ireland.

[9] Article 31 states that the Regulation applies to “events giving rise to damage which

occur after its entry into force”. The date of entry into force, according to article 32, was 11

January 2009.

Issue 1: whether Rome II Regulation applies

Argument for the defender

[10] On behalf of the defender, it was submitted that the Regulation applied to determine

the applicable law. For the purposes of article 31, the deceased’s death in 2011 was among

the “events giving rise to damage”. The article was badly drafted; the phrase “events giving

rise to damage” included everything leading up to the occurrence of damage, and was not

restricted to negligent acts. As article 2(3) made clear, it could include future events. In the

present case, the diagnosis of respiratory disease, the subsequent symptoms, and the

deceased’s death occurred after the entry into force of the Regulation and it therefore

applied. In the alternative, if death was not itself an event giving rise to damage, the post-

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diagnosis symptoms were such an event, and that was sufficient for the Regulation to apply.

Reference was made to Lazar v Allianz SpA Case-350/14; [2016] 1 WLR 835.

Argument for the pursuers

[11] On behalf of the pursuers, the primary submission was that the circumstances of this

case did not give rise to any issue of conflict of laws. This was a straightforward claim in a

Scottish court by relatives of a person who had become ill and died as a consequence of

exposure in Scotland to inhalation of asbestos fibres. The only point of interaction between

the deceased and the defender was at the stage of exposure; that was when the legal

relationship between them was established. In any event, it was submitted that the

Regulation drew a clear distinction between damage on the one hand and events giving rise

to damage on the other. Article 31 was not poorly drafted: it had to be broad enough to

cover all of the obligations within the scope of the Regulation. The only reasonable meaning

of “events giving rise to damage” was events creating a legal obligation if they were allowed

to happen; anything else was irrelevant. In the present case, the only events creating an

obligation were events that exposed the deceased to asbestos. Those occurred long before

the entry into force of the Regulation and it did not apply.

[12] If that was wrong, then this was a situation in which the court should apply article

4(3) and find that the delict is manifestly more closely connected with the law of Scotland

than with the law of England. The breach of duty consisting of asbestos exposure had taken

place in Scotland by a Scottish employer. The relationship between the deceased and the

employer was more closely connected with the delict than the place where the deceased’s

body was injured or the place where he sustained material damage. It would make no sense

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to apply any law other than Scots law determine whether there was negligence more than 70

years ago in Scotland.

Decision

[13] In my opinion the circumstances of the case do give rise to an issue of conflict of

laws, but by virtue of the commencement provision in article 31, the Rome II Regulation has

no application to it. The reference in article 31 to “events giving rise to damage” is clearly

linked to the distinction drawn in article 4(1) between three separate concepts, namely (i) the

event giving rise to the damage; (ii) the damage; and (iii) the indirect consequences of the

event. In the present case, the damage consisted of the deceased’s illness and death. The

indirect consequences are the losses suffered by the deceased’s relatives. The event giving

rise to all of this was exposure to asbestos. One can test this by considering an action during

his lifetime by the person who suffered the exposure. In that situation it can clearly be seen

that the damage consists of material injury and that the event giving rise to the damage is

the negligent exposure. It does not affect the analysis that there may also be indirect

consequences which are the subject of claims.

[14] This interpretation is strongly supported by the judgment of the Court of Justice in

Lazar v Allianz SpA (above). That case concerned a claim made in an Italian court by the

Romanian relatives of the victim of a road traffic accident which occurred in Italy, caused by

an unidentified vehicle. If Italian law was applicable, the Romanian relatives were entitled

to an award of damages. Having referred to recital 17, the Court stated (paragraph 25):

“It follows that, where it is possible to identify the occurrence of direct damage,

which is usually the case with a road traffic accident, the place where the direct

damage occurred is the relevant connecting factor for the determination of the

applicable law, regardless of the indirect consequences of that accident. In the

present case, the damage is constituted by the injuries which led to the death of Mr

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Lazar's daughter, which, according to the referring court, occurred in Italy. The

damage sustained by the close relatives of the deceased must be regarded as indirect

consequences of the accident at issue in the main proceedings, within the meaning of

article 4(1) of the Rome II Regulation.”

As the Court made clear, the damage in that case consisted of the injuries sustained by the

victim of the accident. It follows that the event giving rise to the damage was the accident.

Applying that distinction to the present case, the event giving rise to the damage was the

allegedly negligent exposure to asbestos, which occurred before the entry into force of the

Regulation.

[15] It is accordingly unnecessary for me to address the question of what the applicable

law would be under the Regulation. It is also unnecessary for me to address the pursuers’

submission that any choice of English law by virtue of article 4(1) should be displaced by

applying article 4(3) and holding that the delict is manifestly more closely connected with

Scotland. That appears to me to be a matter of some complexity and I prefer not to express

an opinion on it when it is not necessary to do so.

Issue 2: applicable law at common law

[16] The Private International Law (Miscellaneous Provisions) Act 1995 amended the

common law of both Scotland and England and Wales in relation to choice of law for

determining issues relating to delict/tort. It is, however, common ground that that Act has

no application to the circumstances of the present case because, in terms of section 14, it does

not apply to acts or omissions giving rise to a claim which occurred before the

commencement of the Act. The matter accordingly falls to be determined by the pre-1995

Act common law.

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[17] In Naftalin v London, Midland and Scottish Railway Co 1933 SC 259 and again in

McElroy v McAllister 1949 SC 110, it was held that Scots law would not recognise a right of

action unless it was admitted by the lex loci delicti. In each of those cases the claim of a

widow for solatium following the death of her husband in an accident in England was

refused on the ground that English law, the lex loci delicti, excluded claims of that nature.

There was, however, no difficulty in those cases in identifying the lex loci delicti: to borrow

from the terminology of Rome II, the event giving rise to the damage (the accident) and the

damage itself (the death) had both occurred in the same place. They do not provide a clear

identification of the lex loci delicti where the harmful event occurs in one jurisdiction but the

harm, consisting of physical injury, occurs in another.

Argument for the defender

[18] On behalf of the defender it was submitted that it was well recognised that there had

to be concurrence of injuria (breach of duty) and damnum (occurrence of material harm)

before a right of action in delict arose. The locus delicti was the place of such concurrence.

That was consistent with the opinion of Lord President Cooper in McElroy v McAllister.

Reference was made to the observations in Rothwell v Chemical Insulating Co Ltd [2008] 1 AC

281 of Lord Hope of Craighead at para 47 and Lord Rodger of Earlsferry at paras 83-88.

[19] On the facts of the present case, the concurrence of breach of duty and material harm

occurred in England, when non-negligible asbestos-related damage was diagnosed. It

followed that the locus delicti was England, and English law applied. Any claim under the

Damages (Scotland) Act 2011 was irrelevant.

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Argument for the pursuers

[20] On behalf of the pursuers it was emphasised that the position of the present

defenders was distinguishable from that of ICI in that the allegedly negligent exposure to

asbestos had taken place in Scotland. The critical question, once again, was not when

concurrence of injuria and damnum had occurred; rather it was when the relationship

between the defender and the deceased had subsisted. The fact that the deceased had

moved afterwards to live in another jurisdiction was a matter of chance which ought not to

determine the law applicable to a breach of duty in Scotland. Reference was made to

Distillers Co (Biochemicals) Ltd v Thompson [1971] AC 458 (PC), which was concerned with a

question of whether the English courts had jurisdiction. Delivering the judgment of the

Privy Council, Lord Pearson (at page 466) identified three possible interpretations of a New

South Wales statute which referred to “a cause of action which arose within the

jurisdiction”, and chose to construe this phrase as meaning that the act on the part of the

defendant which gave the plaintiff his cause of complaint must have occurred within the

jurisdiction. By way of contrast, in Durham v T&N plc (Court of Appeal, 1 May 1996,

unreported), it was held that an employee injured in Quebec by exposure to asbestos dust

could not sue an English company in England after expiry of a limitation period under the

law of Quebec, because the wrongful act had occurred in Quebec. In the present case the

wrongful act took place in Scotland, and accordingly the applicable law was Scots law.

Decision

[21] In assessing the relevance of the authorities cited, it is important to guard against

placing undue reliance on judicial observations made in a different context. Many of the

authorities cited were concerned with issues of jurisdiction or limitation and not with the

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question with which this case is concerned, namely identification of the locus delicti. I have,

however, concluded that authoritative guidance is provided by dicta in cases concerning

inhalation of harmful dust. In Brown v North British Steel Foundry Ltd 1968 SC 51, an

employee who was exposed to siliceous dust between 1941 and 1949 was diagnosed in 1958

as suffering from pneumoconiosis. The pursuer could not prove that he had suffered from

the disease prior to 1955, and his action for damages was held to be time-barred under the

Law Reform (Limitation of Actions etc) Act 1954 as the cause of action had not arisen before

the Act was passed. Lord President Cooper stated (pages 64-5):

“…There was in fact no cause of action in 1949. To create a cause of action, injuria

and damnum are essential ingredients. In the present case there is no evidence of any

injuries to the workman's lungs in 1949. He had then merely a deposit of dust in his

lungs, which might or might not subsequently create an injury. But, in addition, he

had then sustained no damnum. He could not then have been awarded damages for

any loss, because at that stage he had sustained no loss of wages and had suffered

none of the discomforts and disabilities which, he avers, followed upon the onset of

pneumoconiosis and which in fact flowed from the outbreak of that disease in 1955.”

For present purposes, the first part of this observation is the more significant: the presence of

dust in the pursuer’s lungs was not of itself regarded as constituting injury.

[22] The passage above was cited by Lord Rodger in Rothwell v Chemical & Insulating Co

Ltd [2008] 1 AC 281 (in which it was held that the development of pleural plaques as a

consequence of asbestos exposure did not create a cause of action, a decision subsequently

reversed by statute in Scotland) at paragraph 86. Lord Rodger continued (paragraphs 87

and 88):

“87 In summary, three elements must combine before there is a cause of action for

damages for personal injuries caused by a defendant's negligence or breach of

statutory duty. There must be (1) a negligent act or breach of statutory duty by the

defendant, which (2) causes an injury to the claimant's body and (3) the claimant

must suffer material damage as a result.

88 In these cases the claimants do not suggest that the presence of the asbestos fibres

in their lungs constitutes an injury…”

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To similar effect, Lord Hope stated (paragraph 47):

“It is well settled in cases where a wrongful act has caused personal injury there is no

cause of action if the damage suffered was negligible. In strict legal theory a wrong

has been done whenever a breach of the duty of care results in a demonstrable

physical injury, however slight. But the policy of the law is not to entertain a claim

for damages where the physical effects of the injury are no more than negligible...”

[23] Again it must be acknowledged that the point being addressed is not the one that

arises in the present case. But it is clear from both of these dicta that, leaving aside the

question of whether there has or has not been material damage, a cause of action in delict

does not arise unless and until there has been both a wrongful act and resultant injury.

Specifically, the presence of asbestos dust in an employee’s lungs does not of itself constitute

injury, and (subject to the Scottish statutory provisions regarding pleural plaques) no cause

of action arising out of negligent exposure arises until it does.

[24] As the recitals to the Rome Convention recognised, use of the Latin phrase lex loci

delicti is apt to create uncertainty because it is open to more than one interpretation. An

English translation such as “the law of the place of the harmful event” does not take matters

much further where the act or omission causing injury and the injury itself take place at

different times in different places. It seems to me, however, that since injury is an essential

ingredient of an actionable wrong, and since injury obviously cannot take place until after

the breach of duty has occurred, the place of the harmful event (or locus delicti) is where the

injury takes place and not, if different, where the antecedent negligent act or omission

occurred.

[25] This conclusion is consistent with the decision in Evans & Sons v Stein & Co (1904) 7F

65, a defamation case in which an action for damages was raised in respect of slanderous

statements about the pursuers made in two letters and a telegram sent by the defenders in

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Scotland to the pursuers in England. As Lord McLaren explained (page 68), while Scots law

awarded reparation for defamatory statements made to the party accused, English law gave

no redress without publication to a third party. The pursuers’ claim accordingly depended

upon the applicable law being Scots law. Lord McLaren continued:

“The Lord Ordinary has allowed an issue on the ground, as he states, ‘that Scotland

was the locus delicti, because the letters were written and posted and the telegram

despatched in Scotland.’

On the best consideration I have been able to give to the Lord Ordinary's reasoning

on this subject, I am not able to concur in his opinion. It appears to me that it is of

the essence of an injury of the nature of defamation, that the defamatory charge

should reach its destination, or should at least become known to someone. While the

letters complained of were in transit through Scotland they could not injure the

pursuers, because their contents were as secret and as completely protected from

disclosure as if they had been locked up in the defenders' desk. It was only when the

letters were delivered at Wolverhampton that damage was done; but then the

damage was of a kind that the law of England does not consider actionable.”

Identification of the locus delicti was thus held to depend upon the place of occurrence of

injury, as distinct from the sustaining of actionable damage, and not merely upon where the

event giving rise to the injury had taken place.

[26] I am not persuaded to the opposite conclusion by the authorities relied upon by the

pursuers. Distillers Co (Biochemicals) Ltd v Thompson was concerned with interpretation of

the words “cause of action” in the context of a particular statutory provision. The Privy

Council noted (pages 468-9) that the problem of deciding where in substance a wrongdoing

occurred was a difficult one and found no need to express any opinion on it. Although the

present case is on all fours with Durham v T&N plc in that the “wrongful act” in each case

consisted of exposure to inhalation of asbestos dust, that does not fully answer the question

that has to be addressed here, ie what was the place where the harmful event occurred,

which is not necessarily, in my view, the same thing.

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Disposal

[27] For these reasons I hold that the pursuers’ claims for reparation for loss arising as a

consequence of the allegedly negligent exposure of the deceased to inhalation of asbestos

dust during his employment by the defender’s predecessor fall to be determined according

to English law. Their case, so far as based upon the Damages (Scotland) Act 2011, is

irrelevant. I shall therefore dismiss the action against the defender at the instance of the

second to twenty-fourth pursuers, and I shall exclude from probation the averments of the

first pursuers in so far as these proceed on the basis of the provisions of the Damages

(Scotland) Act 2011. I shall allow a proof before answer in so far as the first pursuers’ case

proceeds under English law, in terms of which their claim is restricted to the three items

listed in paragraph 4 above. Expenses are reserved.