Corby toxic contamination compensation bill revealed as £14.6m
Corby Borough Council has revealed that the total cost of its recent settlement with victims of its failure to properly decontaminate a former steelworks is £14.6m, including the compensation paid to victims and both sides' legal costs. The bill will be paid in annual instalments at the rate of £730,000 per year for the next 20 years.
In April, the council agreed to pay compensation to 19 children and young people who said that they were born with deformities due to the council's failure to remove toxins from the site of a former steelworks which was subsequently turned into a housing estate, although it did not admit liability for the incident.
The council has not confirmed what proportion of the figure relates to legal costs and how much will be paid to the victims, as the compensation settlements remain confidential. In a statement, the Leader of Corby Borough Council, Cllr Pat Fawcett, said: “Corby Borough Council has capitalised the cost of the compensation payment and legal costs. This means we can repay at a rate of £730,000 per year for around 20 years, which the Council are looking to cover through increased income, efficiency savings and natural wastage in staff.”
Des Collins, the solicitor that represented the victims, said that the council could have significantly reduced the legal costs of defending the claim if it had not denied primary liability for so long. Speaking to Local Government Lawyer before the total size of the compensation and expenses bill was announced last Friday (4th June), he claimed that the council should have quickly acknowledged that it had breached its duty to the residents and limited the legal arguments to causation and foreseeability. Collins also suggested that the fact that the council self-insured meant that it continued to fight the case for longer than it should.
“It would have been a much shorter fight,” he said. “Corby insisted on fighting the primary liability issue for eight of the eleven years [that the case ran for] against overwhelming evidence. They could have saved themselves a lot of time and a lot of money if they had looked at this more pragmatically and taken difficult, yet sensible decisions on case management. What they did not have – which is something you often find in situations like this – is the pragmatic approach of an insurer at their shoulder.”
Corby, however, denied that it had been responsible for prolonging the court case . In a statement to Local Government Lawyer, it said: "The Council originally suggested such a course of action to the trial judge Akenhead J at a case management conference in 2008, proposing a short initial hearing, say 3 weeks or so, focussing in on key points of dispute.
"The Claimants strongly resisted this approach and the Judge went with the Claimants on this. The consequence was a much longer trial, necessitated by a lengthy particulars of claim from the Claimants and a judgment which fails to address the issue of causation. The Claimants were not interested in determining what caused the defects rather they were pursuing whether what was discovered might cause any of the defects identified in the Group Litigation and that is all the judgment determined."
The council lost the High Court case in July 2009, after which the council adopted a “twin-track” approach to the case, successfully applying for leave to appeal at the same time as entering into mediation with the claimants and their families. On agreeing to apologise and compensate the victims, Corby Borough Council withdrew its appeal.
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