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Issues Raised Over Admin and Legal Fees in Asbestos Compensation Deal
29th September 2006
£70m Bill for Administration of Compensation Scheme
The administrators of a compensation deal negotiated for the victims of asbestos related illnesses have issued a bill of £40m, with their legal and professional advisors to receive a further amount of £30m. It is anticipated that this will be paid in full, despite the fact that most of the claimants will only receive around 20% of the value of their claim.
Deal for Asbestos Victims
The compensation scheme was set up for workers employed by Federal Mogul, the US parent company of Turner and Newall, across the country at factories and plants. Many workers had developed asbestos related diseases like mesothelioma, however the company went into administration in 2001, thereby freezing all compensation payments.
Administrators, Kroll, were assigned to negotiate the scheme and, after five years a deal was finally agreed this month. The victims will share a compensation fund of £69m and accepted the offer of 20p in the £1. Although this is an improvement on the original offer of just 7p in the £1, it unfortunately means that many victims stand to receive an amount reduced by thousands of pounds. In the case of some mesothelioma victims, this could mean that their claim would be worth £100,000 but they would only receive £20,000.
Law Firm Expresses Concern
Ian McFall of Thompsons Solicitors, The Legal Line’s lawyers, said: “I gave my time as an unpaid volunteer on the creditors committee to argue that victims should receive the best possible compensation deal from the administration of Federal Mogul.”
“Originally asbestos claimants were offered just 7% of what their claim was worth, but through negotiations most people will be likely to receive payments of around 20%. For those families who have suffered, it will be hard to accept that they get only 20% while the administrators and their lawyers will be paid their bill of £70m in full.
Asbestos Compensation Claims
If you or a member of your family is suffering from an asbestos related illness, you may be entitled to claim personal injury compensation. Contact The Legal Line on 0800 0328511 for specialist advice, or by completing a claim enquiry form online.
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