Case Summary: Interpretation of Sections 3–5 of the Damages (Scotland) Act 2011

Factual and Procedural Background

The opinion is delivered by Judge Reed, with Judge Briggs, Judge Hamblen, Judge Leggatt and Judge Burrows agreeing.

The case concerns the interpretation of sections 3 to 5 of the Damages (Scotland) Act 2011 (“the 2011 Act”), which regulate rights to damages in The State in respect of personal injuries and death.

The Respondents are members of the immediate family of a deceased individual (“the Deceased”), who died of mesothelioma in 2018. The Deceased had been employed by the Appellant, Company A, between 1969 and 1992, during which he was exposed to asbestos.

In 2014, the Deceased sued Company A for damages after he developed pleural plaques and contracted asbestosis as a result of that asbestos exposure. His claim included damages in respect of the risk that he might in future develop mesothelioma. The action was settled by agreement. At the time of settlement, the Deceased was not suffering from mesothelioma.

The settlement discharged Company A from further liability to the Deceased in respect of all consequences of his asbestos exposure, including liability in the event that he later developed mesothelioma. This effect of the settlement was common ground between the parties.

After the Deceased’s death from mesothelioma, the Respondents raised the present action seeking damages under section 4(3)(b) of the 2011 Act for non-patrimonial losses (such as distress, grief, and loss of society and guidance). Company A contended that the action was barred by section 4(2) of the 2011 Act, because the Deceased had, by the 2014 settlement, discharged Company A’s liability to pay damages to him before his death.

The Respondents relied on the statutory exception contained in section 5 (“exception for mesothelioma”), arguing that the conditions in section 5(1)(a)–(c) were all satisfied. Company A accepted that section 5(1)(b) and (c) were met (the Deceased died from mesothelioma, and both the discharge and death occurred on or after 20 December 2006), but submitted that section 5(1)(a) was not satisfied because, at the time of the settlement, the Deceased was not yet suffering from mesothelioma.

The Lord Ordinary rejected Company A’s argument ([2023] CSOH 50; 2023 SLT 755). The First Division also rejected the argument and upheld that decision ([2024] CSIH 14; 2024 SC 373), but granted permission to appeal. The present opinion resolves that appeal.

Legal Issues Presented

1. Whether, for the condition in section 5(1)(a) of the Damages (Scotland) Act 2011 (“the liability to pay damages to A … is discharged … by A before A’s death”) to be satisfied, it is necessary that the deceased (A) was already suffering from mesothelioma at the time when that liability was discharged.
2. More broadly, how the phrase “liability to pay damages” should be interpreted within sections 3, 4, and 5 of the 2011 Act, and whether it is restricted to liability to pay damages for mesothelioma in the context of section 5.

Arguments of the Parties

Appellant's Arguments (Company A)

• The phrase “liability to pay damages” in section 5(1)(a) should be read as meaning a liability to pay damages specifically for mesothelioma.
• At the time the Deceased settled his earlier action (when he had pleural plaques and asbestosis, but not mesothelioma), Company A had no liability to pay damages for mesothelioma, because the Deceased was not yet suffering from that condition.
• Accordingly, there was no “liability to pay damages [for mesothelioma]” that could have been discharged within the meaning of section 5(1)(a), and therefore the statutory exception in section 5 could not apply. The claim by the Respondents should therefore be barred by section 4(2).
• Company A also relied on the heading of section 5, “Discharge of liability to pay damages: exception for mesothelioma,” arguing that this shows the entire section is concerned only with the discharge of liability to pay damages for mesothelioma.
• By reference to background materials, Company A submitted that the “mischief” the legislation was intended to address was the dilemma facing persons who already knew they were suffering from mesothelioma: whether to obtain damages for themselves during their lifetime and thereby bar relatives’ claims, or forgo their own claims to preserve their relatives’ rights. It was said that the statute should be interpreted to confine the exception to that precise situation.
• Company A further contended that the Respondents’ construction produced absurd or anomalous results:
  • It was said to be absurd that the Deceased’s relatives could claim for loss resulting from his mesothelioma when no such claim was open to the Deceased himself at the time of the earlier settlement.
  • It was said to be anomalous that special protection was afforded to those at risk of mesothelioma but not to those at risk of other fatal conditions, such as asbestos-related lung cancer.

Respondents' Arguments (Family Members)

• The Respondents maintained that all three statutory conditions in section 5(1) were satisfied:
  • Section 5(1)(a): the liability to pay damages to the Deceased was discharged by him before his death, via the 2014 settlement.
  • Section 5(1)(b): the personal injury in consequence of which the Deceased died was mesothelioma.
  • Section 5(1)(c): the discharge and the death both occurred on or after 20 December 2006.
• On that basis, they argued that the exception in section 5 applied and that section 4(1) imposed liability on Company A to pay them sums of damages under section 4(3)(b), despite the prior discharge of liability to the Deceased.
• They opposed the Appellant’s restrictive reading of “liability to pay damages” in section 5(1)(a), contending that the text did not require that the Deceased was already suffering from mesothelioma at the time of discharge.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
[2023] CSOH 50; 2023 SLT 755	Decision of the Lord Ordinary in the same litigation rejecting Company A’s interpretation of section 5(1)(a).	Cited as part of the procedural history; Judge Reed noted that his reasons were essentially the same as those of the courts below.
[2024] CSIH 14; 2024 SC 373	Decision of the First Division upholding the Lord Ordinary’s rejection of Company A’s argument.	Again cited as background and as support for the Supreme Court’s conclusion, which aligned with the reasoning of the lower courts.
R v Secretary of State for the Environment, Transport and the Regions, Ex p Spath Holme Ltd [2001] 2 AC 349	Principle that courts must give effect to the meaning of legislation as enacted; citizens must be able to understand and rely on the words of an Act of Parliament.	Quoted to emphasise the constitutional importance of applying the clear meaning of statutory text and not reshaping it to fit perceived policy aims or background “mischief.”
R (O) v Secretary of State for the Home Department [2022] UKSC 3; [2023] AC 255	Principle that external aids (such as background materials) cannot displace clear and unambiguous statutory language which does not produce absurdity.	Relied upon to reject the argument that background materials about the mesothelioma “dilemma” could narrow the plain scope of sections 3–5 of the 2011 Act.

Court's Reasoning and Analysis

1. Textual Analysis of Sections 3–5

Judge Reed first examined the statutory language. Company A argued that the phrase “liability to pay damages” in section 5(1)(a) must mean a liability to pay damages for mesothelioma, and that because the Deceased did not have mesothelioma at the time of settlement, no such liability existed or was discharged.

The court rejected that argument for several reasons:

• Effect of the 2014 claim and settlement: The Deceased’s prior action against Company A explicitly included a claim for damages in respect of the risk of developing mesothelioma in the future. The settlement of that claim had the effect of discharging Company A’s liability to pay him damages if he later did develop mesothelioma. Accordingly, even assuming (contrary to the court’s later analysis) that section 5(1)(a) referred only to liability for mesothelioma, such liability had in fact been discharged by the settlement.
• Consistent meaning of “liability to pay damages” across sections 3, 4 and 5: The phrase appears in section 3 as well as in sections 4 and 5. Given the interconnection of these provisions, the phrase must bear the same meaning in each:
  • Section 3 sets the circumstances in which sections 4 to 6 apply, namely where a person dies in consequence of personal injuries caused by another and “the act or omission … gives rise to liability to pay damages to A.”
  • Section 3 is general in scope; it is not confined to mesothelioma. There is no basis for reading “liability to pay damages” in section 3 as referring only to liability for mesothelioma.
  • Section 4, which governs liability to relatives, is similarly general. When section 4(2) excludes liability to relatives if “the liability to pay damages to A … is excluded or discharged … by A before A’s death,” the phrase plainly refers to liability to pay damages in respect of the relevant act or omission generally, not just mesothelioma.
  Thus, by parity of reasoning, “liability to pay damages” in section 5(1)(a) must carry the same general meaning as in section 4(2) and section 3.
• Structure of section 5: Section 5(1)(a) itself says nothing about mesothelioma. It is section 5(1)(b) that introduces the condition concerning mesothelioma, namely that the personal injury in consequence of which A died was mesothelioma. Section 5(1)(a) therefore does not—and on its wording cannot—require that A was already suffering from mesothelioma at the time the liability was discharged.
• Self-defeating nature of Company A’s construction: The court also pointed out that the defenders’ construction undermined their own position:
  • If there were no discharge of liability to pay damages for mesothelioma (because such liability did not yet exist when the settlement occurred), then section 4(2) could not bar the Respondents’ claim, since that subsection only excludes liability to relatives where liability to A has been discharged.
  • On this hypothesis, section 5(1)(a) would not apply, but neither would section 4(2); the consequence would be that the Respondents’ claim under section 4(1) would proceed unbarred. Thus, the Appellant’s restrictive reading of “liability to pay damages” did not assist its argument.

2. The Heading of Section 5

Company A relied on the heading of section 5—“Discharge of liability to pay damages: exception for mesothelioma”—to argue that the whole section concerns only the discharge of liability to pay damages for mesothelioma.

The court rejected this contention. The heading is entirely consistent with the straightforward reading of the provision: section 5 is concerned with a discharge of liability to pay damages in general and creates an exception to the general rule in section 4(2) in cases where the fatal injury is mesothelioma. It does not warrant rewriting the term “liability to pay damages” in section 5(1)(a) to mean “liability to pay damages for mesothelioma.”

3. Background Materials and the “Mischief” Addressed

Company A referred to external materials, including the Policy Memorandum on the Bill that became the Rights of Relatives to Damages (Mesothelioma) (Scotland) Act 2007 (“the 2007 Act”), whose provisions were later re-enacted in sections 3 to 5 of the 2011 Act. These materials showed that the legislative impetus was the “dilemma” faced by persons who knew they were suffering from mesothelioma: claim damages during their lifetime (thus barring relatives’ claims), or forgo their own damages to preserve relatives’ higher-value claims.

Judge Reed accepted that the materials clearly identified this dilemma as the problem the legislation sought to address. However, he drew several important conclusions:

• Legislation must be applied as enacted: Citing Spath Holme, the court emphasised the constitutional principle that courts must give effect to the meaning of legislation as enacted. Citizens are entitled to rely on what they read in an Act of Parliament. While identification of the mischief can assist in interpretation, it cannot override the clear and unambiguous language of the statute.
• External aids cannot displace clear text: Relying on R (O), the court held that background materials do not displace meanings conveyed by the words of a statute which, considered in context, are clear, unambiguous, and non-absurd. In this case, section 5(1)(a) is unambiguous, and its meaning remains clear even after considering the background materials.
• The enacted provisions go beyond the minimal solution to the mischief: The Policy Memorandum itself indicated that the Bill’s approach went further than strictly necessary to remove the identified dilemma. Similarly, sections 3–5 of the 2011 Act go beyond addressing only that narrow problem. This broader effect is a function of the statutory wording chosen by the legislature, and the court cannot confine the Act’s operation to a narrower field than the language clearly covers.
• Court cannot rewrite the statute: To limit the effect of the legislation strictly to individuals who knew they were suffering from mesothelioma at the time of discharge would require substantial rewriting of section 5(1). It would not be enough simply to insert “for mesothelioma” after “damages” in section 5(1)(a); it would also require adding an extra condition such as:

  (d) A was suffering, and knew that he was suffering, from mesothelioma at the time of the discharge.

  No such condition appears in the statute. The court stated it could not insert such wording and effectively legislate from the bench.
• Rational reasons for a broader protective scope: The court considered that, although the original “dilemma” concerned those who knew they had mesothelioma when discharging liability, there were understandable reasons for drafting the provisions more broadly. A narrower exception would have excluded:
  • Relatives of individuals who had mesothelioma at the time of discharge but did not know it, whether because it had not been diagnosed or the diagnosis had not been communicated.
  • Relatives of individuals like the Deceased who developed mesothelioma only after liability was discharged.
  It was therefore understandable that the legislature chose to avoid drawing such fine distinctions and instead excepted from the general bar in section 4(2) the relatives of anyone who died of mesothelioma after having discharged the liability to pay damages.

4. Alleged Absurdity or Anomaly

Company A argued that the Respondents’ interpretation produced absurd or anomalous results. The court addressed these points directly:

• Relatives having a claim when the Deceased did not: It was said to be absurd that the Deceased’s relatives could claim for loss arising from his mesothelioma where no equivalent claim had been available to him at the time of the earlier settlement. The court noted that, on any reading, section 5’s function is precisely to allow relatives to bring claims after liability to the injured person has been discharged. The fact that relatives may have a claim when the injured person does not is the deliberate purpose of the exception, not an absurdity.
• Protection confined to mesothelioma, not other fatal diseases: It was also argued that it was anomalous for the law to protect those at risk of mesothelioma, but not those at risk of other fatal conditions (such as lung cancer caused by asbestos exposure). The court held that:
  • This limitation is a matter of legislative policy. As the heading of section 5 states, it creates an “exception for mesothelioma,” not for other conditions.
  • The existence of this targeted exception could not alter the clear statutory language or justify a different interpretation. It simply reflects the policy choice underpinning the legislation.
  • The court noted that the Scottish Law Commission had considered whether similar exceptions should be created for other conditions and concluded that mesothelioma cases were “highly exceptional” and did not warrant extension to other diseases at the time. The draft Bill in the Commission’s report was enacted as the 2011 Act, reinforcing that the legislature knowingly chose a mesothelioma-specific exception.

Holding and Implications

Holding: The court held that section 5(1)(a) of the Damages (Scotland) Act 2011 does not require that the deceased was already suffering from mesothelioma at the time when the liability to pay damages was discharged. The phrase “liability to pay damages” in sections 3, 4 and 5 bears a general meaning and is not restricted to liability to pay damages for mesothelioma. On that correct interpretation, all conditions in section 5(1)(a)–(c) were satisfied in the present case.

Accordingly, section 5(1) applies and, by section 5(2), liability under section 4(1) arises but is limited to damages of the kind specified in section 4(3)(b) (non-patrimonial losses). The bar in section 4(2) does not prevent the Respondents’ claim.

For these reasons, the appeal by Company A was DISMISSED.

Implications:

• The decision confirms that the “exception for mesothelioma” in section 5 of the 2011 Act applies even where liability to the injured person was discharged before that person was diagnosed with mesothelioma, so long as the person later dies from mesothelioma and the other statutory conditions are met.
• Relatives of mesothelioma victims are therefore protected in a wider range of circumstances than the narrow “dilemma” described in the background materials, including where:
  • The illness was undiagnosed or unknown at the time of settlement; or
  • The mesothelioma developed only after general liability for asbestos-related injury had been discharged.
• The judgment reinforces the principle that clear statutory wording must be applied as enacted, and that background materials about legislative purpose cannot be used to narrow the scope of a provision whose language is clear and non-absurd.
• The decision is specific to the statutory scheme governing mesothelioma and does not extend similar protection to other diseases or injuries; the court notes that the legislature consciously confined the exception to mesothelioma and that no broader extension has been enacted.