Lawyers for South African miners suffering from asbestos-related illnesses said on Tuesday they had given London-listed Cape Plc an ultimatum to pay an out-of-court settlement by September 14 or face court.
The building materials firm reached a conditional deal on December 21 to pay 21-million pounds to 7 500 South African miners who blame Cape for asbestos-related diseases they contracted in the 1970s.
The first installment of 11-million pounds was due on June 30, the miners’ London-based lawyer Richard Meeran said.
”It is now September 2 and we still haven’t received anything,” Meeran told Reuters. ”We’ve given them two extensions, and we’ve been fairly indulgent. We can’t allow this to carry on.”
The claimants put their court battle on ice after the December settlement. But that would be revived if Cape did not pay up by September 14, he said.
Meeran said he believed the company was committed to implementing the settlement, but the restructuring that was necessary to raise the money for it had taken longer than expected. The snag was the company’s banks.
The first stage of restructuring — the sale of Cape’s manufacturing business — was almost complete. But the second stage, which involved Cape borrowing money from its bankers against its assets, had run into difficulties.
”Cape says it has got sufficient assets to provide security to banks for a loan needed to cover our settlement, but the banks are resisting lending them this money,” he said.
”If we get to September 14 and the money hasn’t been paid we will immediately take action.”
No one at Cape was immediately available to comment.
Renewed court action could also see UK-based Charter Plc, Cape’s former parent company, and South African holding company Gencor drawn into the litigation, he warned.
Gencor is already facing separate claims from former employees of Gefco and Msauli asbestos mining operations, which the company sold in the late 1980s.
”Gefco also operated in the same area as Cape, so it follows that a lot of people in the legal action against Cape also had exposure to Gefco, so we’ll draw them into the compensation net if we continue litigation,” he said.
A Gencor representative would not comment on Meeran’s claims.
Meeran said more than 300 claimants had died of asbestosis since 1999, when they first launched the action against Cape. Asbestosis destroys the lungs and eventually kills its victims, and can take decades to become apparent. – Reuters