Battling CSR

When the common law battles by former Wittenoom workers against CSR began in the 1970s, CSR relied on the ‘corporate veil’ to protect itself: it was Midalco (formerly Australian Blue Asbestos Ltd, a subsidiary of CSR), and a company with no significant assets, the legal cases were made against, not against CSR. Piercing the corporate veil became a battle in itself.

In 1978, Cornelius Maas, a married man who had worked at Wittenoom for twelve years and terminally ill with asbestosis and mesothelioma, became the first ex-Wittenoom worker to issue a writ for civil damages against Midalco Pty Ltd. He died before the case reached court and his widow did not proceed with the action.

Joan Joosten’s case quickly followed. A stenographer who worked in the company office in Wittenoom Gorge from 1950 to 1953, Joan developed mesothelioma and sued Midalco in 1978. Her claim was dismissed in 1979. It was all, the judge said, ‘a sad misadventure’. Appeal against the judgment remained unheard when Joan Joosten died early in the following year.

Walter (Wally) Simpson, who had worked at Wittenoom in the early 1960s, sued Midalco for exposing him to the asbestos fibres which, he claimed, caused his lung fibrosis. The case hinged on whether the fibrosis was asbestosis, the judge finding against him but the judgment was overturned on appeal and a re-trial ordered. His claim was then settled out of court and he received $220,000.

The Klaus Rabenalt case against Midalco was a breakthrough. He had worked at Wittenoom in the early 1960s in very dusty conditions for some time as a bagger in the mill among other Wittenoom work sites. He developed mesothelioma. In the Victorian Supreme Court in 1988, he was awarded substantial damages against the company. The jury found that the company’s negligence had caused Klaus Rabenault’s mesothelioma and awarded him compensatory damages of $426,000. As well, for the first time ever in Australia in a negligence claim, the jury was satisfied the defendant’s clain was of a reckless nature and awarded punitive and exemplary damages of $250,000. This decision was confirmed on appeal.

This landmark case was immediately followed by another: the 1988 success of Peter Heys and Stephen Barrow, both mesothelioma sufferers, in the WA Supreme Court against CSR as well as Midalco. The judge found that that CSR and ABA did not do enough to understand the hazards and available means of avoiding or minimising them and that workers had not been warned of the dangers. He also found that dust reduction would have lessened the risk of all asbestos diseases, and that failure to do so constituted negligence. The Heys and Barrow victory legally established CSR’s negligence, thus piercing the corporate veil.

After finally accepting liability, CSR began settling claims out of court. In 1989 the Wittenoom group settlement was agreed in which CSR paid $18,266,000 to 200 Wittenoom claimants. The law firm Slater & Gordon was chiefly responsible for these legal victories against CSR.

The Wittenoom group settlement was not the end of the matter for CSR, however. Other workers, Wittenoom residents and, most distressing of all, Wittenoom’s former children all had their day in court.

Like other employers whose workers handled asbestos, CSR has faced ongoing liabilities; in 2010 these liabilities totalled $30-50 million a year.