Will the collapse of multinational services group Carillion Plc, in January this year, have a further impact upon mesothelioma claims by former employees at firms previously taken over by the construction giant?
Tracing former employers of men or women who believe they were exposed to asbestos at their workplace may not be so straightforward if the original company no longer exists or has changed ownership several times over the years. In some cases, an asbestosis lawyer will find a complex corporate structure may have evolved comprising subsidiaries and holding companies spread across a number of countries.
Carillion was the UK’s second largest construction company with around 43,000 employees, of which 20,000 were based in Britain. It was formed in 1999 to operate the “construction and professional services” division previously under the ownership of Tarmac, supplier of road surfacing materials.
Long history of company mergers and takeovers
At first glance, it might be presumed that Carillion was highly unlikely to be linked with asbestos exposures. UK imports of the most toxic brown and blue fibres had been banned 15 years prior to formation of the company, which occurred in the same year that imports of white asbestos were officially banned.
The majority of asbestos exposures today involve claimants who began their working lives during the 1960s and 1970s when UK asbestos use was at its peak but was in noticeable decline by the early 1980s.
However, there is a long history of company mergers and takeovers at Tarmac, which can be traced back to its founding in 1903 after ‘Tar Macadam’, a new and less expensive method of road surfacing was patented two years earlier.
The first company acquisitions occurred from the late 1950s and early 1960s, and by 1968 there was a three way merger between Tarmac, Derbyshire Stone and the Scottish Asphalt company, which created the UK’s “largest roadstone and construction group”, briefly known as Tarmac Derby.
During the 1970s, there were takeovers of Permanite, Britain’s biggest roofing felt manufacturer, Limmer, an asphalt company, Mitchell Construction based in Peterborough, Mclean Homes, which was building 4,000 houses a year, and Holland, Hannen & Cubitts, an established contracting firm.
Widely used across the building and construction industry
Throughout this period, an average of 170,000 tons of asbestos was being imported every year for the production of low-cost insulation and fireproofing products widely used across the building and construction industry. Typical asbestos-containing materials were asphalt roofing shingles or corrugated roofing, felts for flat roof materials, sprayed roof insulation, cement piping, wallboard, millboard, wall and ceiling tiles, popcorn ceilings, decorative plasters, soffits, window sills, boiler linings and pipework lagging.
By 1995, Tarmac had progressively reduced its housebuilding activities and during the same year announced an asset swap with Wimpey, one of the largest UK housebuilding companies, founded in 1921. Under this arrangement, Tarmac received Wimpey’s construction and minerals divisions while Wimpey acquired all of Tarmac’s housing.
Following its formation, Carillion notably acquired Mowlem – established nearly 200 years ago – and Alfred McAlpine founded in 1869, both two of the UK’s largest construction and civil engineering companies.
Part of a former insurers compensation will be reduced
It has been pointed out that some of the acquired companies were previously involved as defendants in asbestosis claims but since that time, several of the liability insurers used within the industry are no longer in business. Furthermore, Employers Liability insurance was not compulsory until after 1972.
Consequently, any part of a former insurers compensation that may be obtained from the Financial Services Compensation Scheme (FSCS) will be reduced. The former employer, if still in business, would then be required to make up the shortfall in compensation.
It’s yet unclear to what extent the collapse of Carillion and the past history of company takeovers may have on the number of future claims by those who may have been exposed to asbestos during the middle decades of the 20th century. It seems there may be a challenge to obtain full compensation and victims or their families will need to take informed advice from their asbestosis lawyers.