Over 500 people who suffered injuries from their Land of Leather sofas may not receive compensation, the High Court was told on Friday 27 March 2009.
It's the latest twist in a story Watchdog has been following since February 2008: the sofas that left thousands of people with horrific injuries.
Watchdog was the first to identify the cause of the problems - a sachet of a highly sensitising chemical called DMF that is placed in the sofas by the manufacturers to prevent mould growth.
Some 2,000 victims are now involved in a group action, most of whom bought their sofas from three main retailers; Argos, Land of Leather and Walmsley's. The three high-street stores could face more than £10m in compensation and legal costs, the claimants' lawyers say, making it "the largest group compensation claim ever seen in British Courts".
Three retailers admit liability
All three of the major retailers have admitted liability, and in a hearing held at the High Court on Friday 27 March, lawyers for Argos and Walsmleys's said they wanted compensation claims for proven injuries agreed as quickly as possible. This comes as a huge relief to customers who bought their sofas from either chain.
Pamela Dalton suffered months of agony when the sofa she bought from Argos left her with a painful rash on her legs and back. She's now likely to get several thousand pounds worth of compensation for the injuries she sustained. Pamela's delighted with the news: "I can close the book on it at last and that's a great relief", she told us.
No pay out
However, at the same court hearing Land of Leather's insurers, Zurich, dramatically announced that it wasn't going to pay out for the majority of the chain's customers, and possibly, none at all.
This leaves its customers uncertain if they'll ever get compensation for their injuries. Last year Mel Hackworth's daughter, Abbie, developed a painful rash on her legs caused by the sofa she'd bought at the Land of Leather. Mel now doesn't know if they'll get anything to compensate for Abbie's injures: "If it was their daughter who'd been in so much pain for months I don't think they'd be as quick to say "no, we don't want to pay".
The judge has given Zurich three weeks to confirm whether or not it will cover claims for those who bought affected sofas from Land of Leather. Richard Langton, the lawyer heading the action against the retailers, is disappointed with Zurich's behaviour. He told us that he hoped the company would, "reflect very hard in the next 21 days as to whether they seriously are going to refuse to pay compensation".
Total ban on DMF use
The EU has recently announced a total ban on DMF used in any products being imported into member states. The ban will become law on 1 May. The EU has also ordered a full recall of any products known to have contained DMF. What form the ban will take is up to authorities in each member state. BERR (the government department responsible).
When Watchdog spoke to Zurich it said: "First and foremost we'd like to express our sympathy for the pain and distress suffered by the individuals that purchased sofas affected by the toxic substance DMF.
"We announced at last week's case management conference that we would not be providing cover for some of the claims under Land of Leather's Product Liability policy, (Product Recall cover was not provided) following our investigations regarding the following:
"Our investigations concluded that Land of Leather has breached the conditions of their insurance and therefore we've declined Land of Leather claims relating to Linkwise furniture, and any other furniture alleged to have caused injury as a result of exposure to DMF after 3 December 2008.
"We must stress that the decision to decline insurance on this occasion hasn't been taken lightly and it's only in very rare circumstances would we take such action. While the legal process prevents us from confirming these reasons for declining these claims at this stage, we can confirm that the issues involved were so fundamental to the insurance contract, that after consulting with our legal team, the decision was made not to grant cover.
"We'll provide further details regarding our decision to the Court and the claimant's solicitors, to ensure our position is communicated to those affected by this case.
"The claims that have been declined to date, represent about 20 per cent of the Linkwise claims."
Read the list of known affected sofas.
Dramatic new twist in sofas saga
It's the latest twist in a story Watchdog has been following since February 2008: the sofas that left thousands of people with horrific injuries.
Watchdog was the first to identify the cause of the problems - a sachet of a highly sensitising chemical called DMF that is placed in the sofas by the manufacturers to prevent mould growth.
Some 2,000 victims are now involved in a group action, most of whom bought their sofas from three main retailers; Argos, Land of Leather and Walmsley's. The three high-street stores could face more than £10m in compensation and legal costs, the claimants' lawyers say, making it "the largest group compensation claim ever seen in British Courts".
Three retailers admit liability
All three of the major retailers have admitted liability, and in a hearing held at the High Court on Friday 27 March, lawyers for Argos and Walsmleys's said they wanted compensation claims for proven injuries agreed as quickly as possible. This comes as a huge relief to customers who bought their sofas from either chain.
Pamela Dalton suffered months of agony when the sofa she bought from Argos left her with a painful rash on her legs and back. She's now likely to get several thousand pounds worth of compensation for the injuries she sustained. Pamela's delighted with the news: "I can close the book on it at last and that's a great relief", she told us.
No pay out
However, at the same court hearing Land of Leather's insurers, Zurich, dramatically announced that it wasn't going to pay out for the majority of the chain's customers, and possibly, none at all.
This leaves its customers uncertain if they'll ever get compensation for their injuries. Last year Mel Hackworth's daughter, Abbie, developed a painful rash on her legs caused by the sofa she'd bought at the Land of Leather. Mel now doesn't know if they'll get anything to compensate for Abbie's injures: "If it was their daughter who'd been in so much pain for months I don't think they'd be as quick to say "no, we don't want to pay".
The judge has given Zurich three weeks to confirm whether or not it will cover claims for those who bought affected sofas from Land of Leather. Richard Langton, the lawyer heading the action against the retailers, is disappointed with Zurich's behaviour. He told us that he hoped the company would, "reflect very hard in the next 21 days as to whether they seriously are going to refuse to pay compensation".
Total ban on DMF use
The EU has recently announced a total ban on DMF used in any products being imported into member states. The ban will become law on 1 May. The EU has also ordered a full recall of any products known to have contained DMF. What form the ban will take is up to authorities in each member state. BERR (the government department responsible).
When Watchdog spoke to Zurich it said: "First and foremost we'd like to express our sympathy for the pain and distress suffered by the individuals that purchased sofas affected by the toxic substance DMF.
"We announced at last week's case management conference that we would not be providing cover for some of the claims under Land of Leather's Product Liability policy, (Product Recall cover was not provided) following our investigations regarding the following:
- The circumstances in which the toxic substance (DMF) came to be used
by the manufacturers, Linkwise and Eurosofa.
- The actions taken by the senior management of Land of Leather to react to the changing circumstances as the situation developed and the scale of the problem became apparent.
"Our investigations concluded that Land of Leather has breached the conditions of their insurance and therefore we've declined Land of Leather claims relating to Linkwise furniture, and any other furniture alleged to have caused injury as a result of exposure to DMF after 3 December 2008.
"We must stress that the decision to decline insurance on this occasion hasn't been taken lightly and it's only in very rare circumstances would we take such action. While the legal process prevents us from confirming these reasons for declining these claims at this stage, we can confirm that the issues involved were so fundamental to the insurance contract, that after consulting with our legal team, the decision was made not to grant cover.
"We'll provide further details regarding our decision to the Court and the claimant's solicitors, to ensure our position is communicated to those affected by this case.
"The claims that have been declined to date, represent about 20 per cent of the Linkwise claims."
Read the list of known affected sofas.
Dramatic new twist in sofas saga