CAN PERSONAL INJURY CLAIMS BE MADE AGAINST COMPANIES IN LIQUIDATION OR NO LONGER TRADING?

There are likely to be a considerable number of valid personal injury compensation claims that have not been pursued, simply because the person either injured in an accident at work or suffering from an Industrial Disease believes that the insolvency or liquidation of the company at fault will prevent them from making a claim.  This is not the case.

Although in some situations it may take a considerable amount of time to piece together the history of a company and trace the relevant insurance cover, in many instances the time required to bring the claim to a successful conclusion is little different from that taken when the defendant company is a solvent business.  The same applies no matter whether the potential defendant is a limited company, a PLC, a sole trader or a partnership that has ceased trading.  The important factor is whether the insurance company that provided the relevant cover to that business can be identified.  If there was a valid insurance policy in force at the time the accident occurred, or the Industrial Disease was suffered, then generally speaking a claim for compensation will be possible.

Of course for such a claim to be successful (and in common with any other type of accident claim) the injured person must be able to establish that the insolvent business is liable to compensate them.  This usually means obtaining evidence that an act of negligence or breach of duty on the part of the business was the cause of the injury or Industrial Disease.

Also, claims must usually be started within 3 years of the date of the accident or discovery of the Industrial Disease; otherwise it may not be possible to proceed at all because of the provisions of the Limitation Act.  If it has not been possible to settle the claim within this period, Court proceedings must usually be issued before the 3rd anniversary.

Where the defendant is a limited company or PLC that has been struck off the roll at Companies House, it is first necessary to make an application to the Court to restore that company to the roll before any proceedings can be issued against it in respect of the claim.  The 3 year limitation period is not extended for this purpose and therefore the company must be restored and Court proceedings issued before this time limit expires.  If this is not done, no further action can usually be taken and the right to compensation is lost.  It is therefore vital for an affected person who is nearing the 3rd anniversary to seek urgent advice from an experienced personal injury solicitor.

The situation is exactly the same whether the injured person was working for the insolvent business, or simply came into contact with them in some way.  For example, when making a delivery and an accident occurred because of the negligence of that business or one of its employees, or a road accident caused by the actions of an employed driver.

If the potential defendant was a sole trader or partnership that is now bankrupt, there are fewer complications for the solicitor pursuing the claim on the injured person’s behalf should the 3rd anniversary be close.  This is because any Court proceedings that are required can be served on the Trustee in Bankruptcy.  However, it is still essential that the solicitor instructed is experienced in handling personal injury claims, as this should ensure that no issues are overlooked or unnecessary delays caused that might adversely affect the chances of success.

In Industrial Disease cases where the person’s poor working conditions many years ago is the most probable cause of their symptoms, but when the illness is not diagnosed until a considerable time after they stopped working for the negligent company, and by which time the company has ceased to exist, significant difficulties can arise when trying to obtain compensation.  An obvious example is in respect of exposure to asbestos.  However, in these situations a different set of rules applies and the 3 year time limit does not start to run until either the disease is diagnosed or the point when it was reasonable to assume that the affected person was aware of their situation prior to a formal diagnosis.  

Most current asbestos claims relate to periods of work during the 1960s and 1970s, as it can often take 15 to 20 years from the time of exposure to asbestos dust for a disease to develop.  Many of the negligent employers ceased trading or were taken over some 10 or 20 years ago.  Some of the affected employees are likely to have worked for several companies in the same industry and it is therefore difficult to establish which company might be liable.  Fortunately, many of the solicitors working in this particularly specialist area of personal injury law have access to data showing the insurance companies that provided cover to companies in the relevant industries.  This can often enable the relevant insurer to be traced when a potential claim is investigated.  If the affected person worked for more than one company, so long as one of them and the relevant insurer can be identified, the full claim can be directed to that insurer and there is no requirement for all the employers and insurers to be traced.

It is always prudent to take specialist legal advice following any type of accident or the development of work related symptoms, to see whether there are grounds to make a claim for personal injury compensation.  The current status of the potential defendant will not prevent an investigation into the matter.  Most claims solicitors will not charge for this work, as they are prepared to work on the basis that their fees are payable by the defendant’s insurers but only if the claim is successful.

Steven Hinchliffe, solicitor and Principal of Hinchliffes Solicitors

© Copyright 2010 Hinchliffes Solicitors

PERSONAL INJURY CLAIM SOLICITORS:-

If you have suffered any form of accident or contracted an industrial disease contact personal injury claims specialists Hinchliffes Solicitors for immediate legal advice, to find out if you are entitled to make a claim for personal injury compensation.  All cases are conducted on a Free No Win No Fee claims basis, where you keep 100% of the compensation recovered.

Call now on 0800 138 1348 to speak direct to one of our specialist claims solicitors or go to our Start Your Claim Now  page to submit details of your accident compensation claim online.
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Steven Hinchliffe established Hinchliffes Solicitors in 1999, after many years as the Managing Partner of a renowned Malvern practice. He has experience in many areas of law, but has concentrated on general civil litigation and Personal Injury. He is the owner and sole Principal of the firm, with overall responsibility for its management, administration and marketing. He is also responsible for overseeing the handling of all the firm’s Personal Injury files, together with specific responsibility for the recovery of costs.

Steven is a Fellow of the Association of Personal Injury Lawyers and spent 12 years as a Deputy District Judge