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South Africa: Five Mining Groups Ask Court to Approve R5 Billion Silicosis Settlement Case

Published by MAC on 2019-06-07

Five companies have agreed to collaborate with ex-workers and their dependants in settling claims for damages resulting from their exposure to silicosis and their suffering from tuberculosis.

Implementation of the scheme is still to be approved by the Gauteng High Court.

Other companies have so far opted not engage in the process.

South Africa: Five Mining Groups Ask Court to Approve R5 Billion
Silicosis Settlement Case

By Ciaran Ryan                      

30 May 2019

Lawyers for thousands of gold miners afflicted by silicosis or
tuberculosis lined up on the side of five mining groups this week to ask
the Gauteng High Court to approve a R5 billion settlement agreement.

The agreement provides for the payment of benefits worth R5 billion to
mineworkers and the dependents of dead mineworkers who contracted
silicosis or pulmonary tuberculosis during or after their employment
from 1965. The benefits will be paid through the Tshiamiso Trust, which
was set up specifically for this purpose.

The settlement agreement is regarded as one of the most complex
multi-party class action settlements ever concluded. This is a sequel to
the so-called Nkala class action suit brought several years ago by
former gold mineworkers seeking compensation against their former
employers for illnesses contracted in the course of their work.

Though the five mining companies and the mineworkers have reached
agreement on the benefits to be paid, the court will have to assess
whether absent mineworkers are adequately protected by the agreement. It
is still unknown how many mineworkers or their dependents are entitled
to claim, as many of them are scattered across the sub-continent. This
will require strict scrutiny by the court.

In 2016 the case was certified as a class action by the Gauteng Local
Division of the High Court, and in December 2018 the court certified
four classes of claimants: (1) those who contracted silicosis or were
exposed to silica dust; (2) the dependents of deceased miners with
silicosis; (3) those who contracted tuberculosis; and (4) the dependents
of deceased miners who contracted tuberculosis while working at the mines.

Now the court is being asked to approve the R5 billion settlement
agreement between legal representatives of the mineworkers and the five
mining companies. The mining companies have secured guarantees for the
R5 billion claim, though the eventual claim could be higher. Of this,
R845 million has been set aside for administering the Tshiamiso Trust,
which will accept claims for a period of 12 years, plus one additional
year to wrap things up.

Affected mineworkers will be paid out between R70,000 and R500,000
depending which of the four categories of claimants they fall into.
Narrowing the claimants into four categories was done to simplify the
payment process and reduce administration costs. The lowest potential
payout will be R10,000 for historic cases of tuberculosis where the
extent of the illness is not known.

Should the court approve the settlement, the class action suit against
the five mining companies will be suspended, though will be continued
against those companies that chose not to settle. Many of the likely
beneficiaries are former migrant workers scattered across southern
Africa, requiring the companies to post notices in neighbouring
countries advising former mineworkers and their dependents of the
potential benefits arising from the settlement.

Five mining groups are party to the settlement: Anglo American SA,
AngloGold Ashanti, Gold Fields, Harmony and Sibanye-Stillwater. The
mining groups that opted to settle rather than continue fighting through
the courts will be protected against any future liability arising from
the same claims.

Mining companies that elected not to participate in the settlement are
DRD Gold, East Rand Proprietary Mines (ERPM), Randgold and Exploration,
Evander Gold, Blyvooruitzicht Gold, Doornfontein Gold, Simmer and Jack
Mines and African Rainbow Minerals. Doornfontein and Blyvoorzicht are no
longer operating and have since been deregistered.

DRD Gold and ERPM opted not to participate in the settlement agreement,
and took issue with the court's jurisdiction to certify the four classes
of claimants, and indicated they would continue to fight the Nkala case
in the Supreme Court of Appeal.

The mineworkers are represented by class action pioneer Richard Spoor
Inc, Abrahams Kiewitz Inc. and the Legal Resources Centre.

Legal counsel for the mineworkers asked the court to approve the
settlement as "fair, reasonable and adequate" on the grounds that it:

it provides for a comprehensive system of compensation;

it is easily accessible by the mineworkers as well as former mineworkers
and their dependants;

it will commence payment of compensation within a relatively short
period of time, short-circuiting protracted legal action;

its structure is designed to be "lawyer free" in that claimants will
engage with the Trust directly, making it unnecessary for a portion of
the benefits to be paid to external agents.

The Trust will also cover periodic medical examinations for current and
former mineworkers at the Medical Bureau for Occupational Diseases as
well as medical screening.

CORRECTION: The article originally listed African Rainbow Minerals as
one of the five companies in favour of the settlement. In fact, it is
one of the companies continuing to litigate against the class action.


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