Smoking Related Diseases Possible Claim
for Health Care Costs
OPINION
1. INTRODUCTION:
1.1 In the United States a number of states
have filed claims against the tobacco companies in which they
are claiming the health care costs involved in treating smoking
related disease. 13 such suits are now pending and it is likely
that further suits will be started. I have been sent the claim
for the case in Texas. These cases are being brought on a variety
of grounds most of which would provide no basis of claim in English
law. Nonetheless I am now asked by ASH to consider whether there
would be any basis for such a claim here to be brought by NHS
trusts on their own behalf and as successors of the previous NHS
responsible bodies. It may be that health care insurers such as
BUPA and Private Patients Plan could also be interested in such
a claim.
1.2 This is obviously very much in the nature
of a preliminary Opinion to investigate whether there is a legal
framework in which a claim could be brought and if so to indicate
the evidence or types of evidence which would need to be obtained
in order to present it with a reasonable prospect of success.
1.3 If in my view there is such a prospect
ASH could then show the opinion to appropriate people for instance
in Health Care Trusts with the suggestion that limited funds be
made available to see if the relevant evidence is available or
could be obtained.
1.4 The first stage is to consider what
are the possible causes of action.
2. POSSIBLE CAUSES
OF ACTION:
2.1 Negligence:
The first suggestion which comes to mind is
to bring proceedings on the basis of negligence. However apart
from any difficulties in proving negligence, the overriding problem
is that, save in exceptional circumstances where there is a specific
duty, the remedy in negligence exists for physical damage, including
the economic loss to the plaintiff resulting from the physical
damage, and not pure economic loss. The health authorities' loss
is purely economic as it consists of the cost to them of treating
and caring for the victims of smoking related disease. As this
would not be a case where there is a specific duty in negligence
enabling pure economic loss to be claimed I do not think that
a case on the grounds of negligence can be made.
2.2 Liability for Defective Products:
A second possibility would be to bring a claim
in respect of post-1987 injuries, on the basis that cigarettes
are defective products within the meaning of the Consumer Protection
Act 1987. If it were possible this would be an attractive option
but it is probably subject to the same difficulty as negligence.
The Act relates to "damage" caused by a "defect"
in a product which is where "the safety of the product is
not such as persons generally are entitled to expect", in
other words there is a risk of physical injury. The whole thurst
of the statute is to protect from physical injury and it does
not contemplate purely economic loss. Even though this specific
issue has not been decided in my view the risk of attempting to
bring a claim on that basis is too great to justify it.
2.3 The "Economic" Torts:
2.3.1 This leaves the so-called "economic"
torts, see generally CLERK & LINDSELL ON THE LAW OF TORT,
17th Edition Chapter 23. These will be considered next. Of these
procuring a breach of contract, intimidation and unlawful interference
with contracts clearly can have no application which leaves only
the tort of civil conspiracy for further consideration.
2.3.2 Conspiracy
2.3.2.1 There are two types of conspiracy
which may be actionable if damage to the plaintiff ensues. They
are where the object is to injure the plaintiff but only lawful
means are used, which now seems to be regarded as anomalous, and
a conspiracy where unlawful means are used to achieve the defendants'
object. As Lord Devlin said in ROOKES v BARNARD [1964] A.C. 1129
at page 1204:
"There are, as is well known, two sorts
of conspiracies, the QUINN v LEATHAM [1901] A.C. 495 type which
employes only lawful means but aims at an unlawful end, and the
type which employes unlawful means."
2.3.2.2 In the first type the object of
the conspiracy must be to injure the plaintiff. For a while as
a result of the language used by the House of Lords in the decision
in LONRHO Plc v SHELL PETROLEUM [1982] A. C. 173 it was thought
that in a conspiracy where unlawful means are used the predominant
purpose also had to be to injure the plaintiff, but in LONRHO
Plc v FAYED [1992] 1 A.C. 448 the House of Lords held that this
was not so and that all that was needed was some intention to
cause injury. I will consider the question of intention below.
2.3.2.3 This type of conspiracy will occur
when there is a combination or agreement the main object of which
is the promotion of the business or other interests of those combining
but which resorts to unlawful means such as the commission of
an intentional tort to do so as a result of which the plaintiff
suffers injury. This seems to me to be a possible basis on which
a claim could be mounted to recover the health care costs.
2.3.2.4 In outline the structure of the
claim would be that the tobacco companies agreed (or combined,
the expression "combination" seems to be favoured because
a conspiracy need not involve the formality of an "agreement")
by creating and operating organisations such as the International
Committee on Smoking Issues (ICOSI), the Tobacco Advisory Council
(TAC) and the Tobacco Research Council (TRC) to promote tobacco
sales and to defend themselves against the claims that smoking
injures health. That for the latter purpose they presented evidence
about the risks and causation of the smoking related diseases
which they knew to be false and misleading and that they did so
to the public, in the form of advertising and various public statements,
to the Government for instance in negotiations about restrictions
on advertising and perhaps to their shareholders. That in consequence
more people started to smoke, continued to smoke or smoked more
and more harmful cigarettes with the natural and inevitable consequence
that additional health care costs were incurred by the plaintiffs.
2.3.2.5 Before considering the kinds of
evidence which may be available I will just examine the ingredients
of such a conspiracy in a little more detail.
3. THE INGREDIENTS
OF CONSPIRACY:
3.1 The Agreement or Combination:
The tort requires an agreement, combination,
understanding or concert involving two or more persons to use
unlawful means to achieve their purpose. The conspirators need
not all join at the same time and their aims need not be identical.
The parties we are concerned with will be either the tobacco companies
themselves or some of their executive officers or some combination
of them.
3.2 Unlawful Means:
Generally speaking any tortious act may be "unlawful
means" in this type of conspiracy, thus Lord Wright said
in CROFTER HAND WOVEN HARRIS TWEED Co v VEITCH [1942] A.C. 435
at p.462:
"It is a different matter if the conspiracy
is to do acts in themselves wrongful, such as to deceive or defraud,
to commit violence, —."
The obvious tortious act here is deceit. Deceit
consists of the making of a false statement by the defendant which
he either knows to be false, does not believe to be true or makes
recklessly careless whether it be true or false intending it to
be acted on and which is then acted on causing damage. It appears
to me that false and misleading advertising could qualify and
perhaps false statements to Government. Other possible "unlawful"
means would be promoting the sale of tobacco products to children
or knowingly manufacturing and selling defective products. The
difficulty with sales to children is that it seems that something
which is a criminal offence but which does not give rise to an
individual right of action does not qualify, see LONRHO Plc v
SHELL PETROLEUM [1982] A.C. 173. The problem with a defective
product argument is that it raises a large number of additional
issues in relation to what is "defective" and whether
the tobacco companies knew that cigarettes were defective within
that meaning. I would therefore advise, assuming the claim seems
otherwise to be viable, to concentrate on deceit as the unlawful
means.
3.3 Intention:
In LONRHO Plc v FAYED [1992] 1 A.C. 448 Lord
Bridge in giving the main speech appears to have accepted the
appellants' submission that in a conspiracy where unlawful means
are alleged there must be an intention to injure the plaintiff
though it need not be the predominant purpose. That was an appeal
against a strike out of the allegation because predominant purpose
was not alleged and the argument was over whether that was a necessary
factor it being held that it was not. There was no debate over
whether the intention had to be a specific intention or whether
a presumed intention to cause the natural consequences of the
acts in question is sufficient. CLERK & LINDSELL paragraph
23-81 says that:
"In judgments involving combinations alleged
to be tortious conspiracies by reason of unlawful means it was
usually suggested that the act need do more than be deliberate
and have the effect of injuring the plaintiff."
This being the law restored by LONRHO plc v
FAYED [1992] 1 A.C. 448 after the apparent decision to the contrary
in LONRHO Plc v SHELL PETROLEUM [1982] A.C. 173. In fact in LONRHO
Plc v FAYED Lord Bridge cited with approval a passage from the
judgment of Scrutton L.J. in WARE AND DE FREVILLE LTD v MOTOR
TRADE ASSOCIATION [1921] 3 K.B. 40 where he said, at p.67:
"I take the MOGUL CASE as deciding that
a combination to do acts, the natural consequence of which was
to injure another in his business, was not actionable, if those
acts were not otherwise unlawful, . . . , and were done in furtherance
of the trade interests of those combining."
Thus implying that the defendant intended the
natural consequences of his actions. In the same case `Bankes
L.J. said at p.56:
"The decisions . . . are all in agreement
to this extent, that a combination of persons to do some act the
object of which is to injure some third person is wrongful and
actionable; so too is a combination of persons to do some act
by unlawful means which will have the effect of injuring some
third person."
Confirming that injury to the plaintiff need
not be the specific intention so long as the actions have "the
effect of injuring" the third person.
3.4 Causing Damage:
Lastly damage must result to the plaintiff.
In the suggested case this would mean a need to demonstrate added
smoking related disease and so increased health care costs as
a result of the deceptive advertising or whatever. It would not
mean it was necessary to prove that individual smokers were affected
by the advertising so long as there was sufficient evidence of
the general effect. The actual quantification of the damage would
not be easy because it would not be the total health care cost
of smoking related diseases but only the additional amount attributable
to the conspiracy occurring within the limitation period.
3.5. I will now consider briefly the sort
of evidence which might be obtainable under each of these heads.
4. WHAT EVIDENCE
CAN BE
OBTAINED TO
SUPPORT A
CLAIM ON
THE GROUNDS
OF DAMAGE
CAUSED BY
A COMBINATION
TO USE
UNLAWFUL MEANS?
4.1 Sources:
I know that there are already large numbers
of documents available both those which have been gathered by
instructing solicitors in their work for individual sufferers
from smoking related diseases and which have entered the public
domain in the course of litigation and other investigations into
the activities of the tobacco companies in the U.S. I have seen
those documents which were used for the Legal Aid appeals in Newcastle
and still have some of them. In addition I have a copy of the
July 1995 issue of the Journal of the American Medical Association
(JAMA) in which they reviewed the Brown and Williamson documents.
These two sources give some idea of the nature of the evidence
which might be obtainable. Where they are available to me I will
add page references from the bundles used in Newcastle hoping
that this will assist in identification. I analysed these documents
in the Summary of Submissions to the Legal Aid Board dated 14
December 1993, see the lengthy paragraph 4, and a table of warnings
and dates of knowledge submitted to the Board on the same occasion.
(It might be helpful to append paragraphs 4.4 to 4.20 from those
submissions to this Opinion when sending it to any of the Health
authorities.)
4.2 Any claim can only relate to matters
within the limitation period that is 6 years from the date the
cause of action accrued. Damage is an essential ingredient in
the tort of conspiracy so that the period will start to run from
health care expense incurred 6 years before the issue of the writ.
Although this will involve the investigation of events and the
activities of the tobacco companies more than 6 years before the
main emphasis must be on their behaviour and advertising since,
say at the earliest, 1980. Many documents pre-date that but even
so may be helpful to indicate their knowledge and approach in
the later period.
4.3 The Agreement or Combination:
4.3.1. The possible defendants are the companies
who are parties to the various industry wide agreements and joint
bodies such as the International Committee On Smoking Issues (ICOSI),
the Tobacco Advisory Council (TAC) and the Tobacco Research Council
(TRC). The constitution of the TAC was in the bundle of documents
at pages 11-14. If it cannot be shown that any provable deceit
was the result of the activities of these joint bodies then named
individuals from individual companies could be added as defendants.
However the bundle of ICOSI briefing papers (pages 28-61) suggests
that much of the propaganda was channelled through joint bodies
which were represented as being independent. Information relating
to the activities of the joint bodies should therefore be a valuable
source of evidence particularly if there are agreements to conceal
or distort information they have on smoking diseases and risk.
4.3.2. The relationship between the joint
bodies and their research activities and the individual companies
research activities is not clear to me but it is apparent that
there was co-ordination in support of their overriding objectives,
such as that described for instance in a 1970 BAT memorandum on
smoking and health as:
" . . . to discourage and delay the process
of restrictive legislative action by governments in every way
possible so as to allow maximum time for research to establish
the precise relationship between cigarette smoking and lung cancer
and other diseases so that any injury to the smoker's health can
be diminished or eliminated." (Bundle p 170).
The tobacco companies strategy was summed up
in a Philip Morris memorandum dated 1st May 1972, (Bundle pp 192-195)
a main plank of which was: "Creating doubt about the health
charge without actually denying it." The whole thrust of
this memorandum was to continue to promote the sale of cigarettes
by obscuring the real message of the research and medical knowledge
namely that smoking cigarettes was a dangerous thing to do. Judging
by their most recent behaviour this strategy seems to have remained
basically unchanged but recent expressions of it would be important.
4.3.3. In the context of their aims, to
promote sales and to fend off adverse Government action for as
long as possible the role they assigned to research could be important.
For example the T.A.C. research programme as discussed in a memorandum
of 21st November 1978 by P.N. Lee, in paragraph 2.3 (b) of which
he states:
" . . . , there was a consensus of opinion
that further studies on smoking by young people should not be
carried out as the results could be used against the Industry."
(Bundle p 189).
If the object of research was not independent
scientific enquiry but was, what it seems to have become, to re-enforce
a position on smoking related diseases which they knew to be false
or did not believe to be true and evidence of this can be obtained
it will be of great help.
4.3.4. These comments are just to point
to the type of evidence which I know to be available and there
were many more documents in a similar vein in the Newcastle papers.
They set the scene for the case but do not in themselves prove
it. What has to be proved is that representations were made, e.g.
"It has not been proved that smoking causes cancer"
which can be shown to be false and which were made as a result
of a concerted policy or agreement by the tobacco companies and
which they either knew to be false or did not believe to be true.
4.4 The Unlawful Means:
4.4.1. As I have already indicated the best
chance is to rely on deceit in advertising and representations
to Government. The analysis in JAMA includes several tables contrasting
what the Brown and Williamson knew from research, what they said
in private and what they said in public. That is useful. Although
it relates to the U.S. Brown and Williamson are a subsidiary of
BAT and so the information would have been disseminated here.
A very extensive analysis of all the information available of
the tobacco companies representations in public advertising, in
public statements, at shareholders meetings and to Government
will need to be made and the statements contrasted with their
state of knowledge to identify the statements which were false
and misleading. The more recent these are the better.
4.4.2. If co-operation could be obtained from
the Department of Health then a similar exercise should be carried
out in respect of any statements made during negotiations on advertising,
tar and nicotine content and so on. This would be particularly
important if the tobacco companies produced flawed research which
the Government accepted as sound and on which they relied.
4.4.3 It will be necessary to show that
these statements were intended to be relied on, which should not
be difficult, and were relied on which will be more difficult.
The result of reliance will be that more people started to smoke,
carried on smoking or smoked more dangerous types of cigarette
as a result or partly as a result of the misleading statements.
In addition if it could be shown that Government was deterred
from taking action by false statements and that if they had taken
action smoking would have been more restricted damage would follow.
4.5 "Intention" to Injure:
If I am right and intention is to be inferred
on the basis that they intended the natural consequences of their
actions there seems to me to be little difficulty in showing that
the natural consequences of increased smoking will be increased
health care costs. This must be re-enforced by the public information
about the burden of smoking on the NHS and it may have arisen
in discussions between the tobacco companies and the Department
of Health so that if information on that could be obtained it
would be useful.
4.6 Damage:
The last element to be dealt with is that of
damage. This will consist of the added cost to the health care
providers caused by the additional smoking caused by the tobacco
companies use of unlawful means, that is deceit in the making
of false and misleading statements. Evidence on this will need
to be obtained both from within the Trusts and on a broader statistical
or epidemiological basis.
5. CONCLUSIONS:
5.1 My review of the possible evidence is
inevitably very brief and inadequate but I hope it gives some
indication of what might be available and how it could fit into
a claim for health care costs on the grounds of a civil conspiracy
to use unlawful means resulting, inevitably, in damage to the
health care providers.
5.2 In my view a proper investigation so
as to see whether a coherent case could be put forward would be
worth while. The costs of such an investigation would not be very
large in relation to the potential gain if the claim succeeded.
Furthermore such a claim is free of some of the difficulties and
objections encountered in the claims for individual sufferers
from smoking diseases.
5.3 Once the investigation has been carried
out the precise range and scope of the claim would need to be
carefully considered so as to give it the maximum chance of success.
J Melville Williams, QC
15 October 1996
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