When Does the Clock on School Claims Start Ticking?: Statutes of Limitation in State Laws Will Play Key Role
One of the primary concerns of The Attorney General's Asbestos Liability Report to the Congress--and an issue that is even more critical now--is whether school districts are running out of time to recover their costs from asbestos manufacturers.
The concern stems from state laws involving "statutes of limitation'' in product-liability cases.
Statutes of limitation basically prohibit a lawsuit from being filed against the manufacturer of a product after a certain period of time. Most state statutes of limitation, according to Robert Wright, principal author of the report, probably are not shorter than one year or longer than four years.
The key question is when the clock starts ticking.
Did it begin with the sale or delivery of asbestos-containing materials to the schools, or with the Environmental Protection Agency's ban against the spraying of asbestos in 1973? Does it date from 1978, when the former Secretary of Health, Education, and Welfare asked all 50 governors to assess the asbestos dangers in their schools, or from June 1983, by which time the epa had required schools to inspect for easily powdered or crumbling asbestos and to notify the public and employees of its presence? Or does the clock start ticking only after schools have completed their abatement work?
"The most likely language will be from when the school districts knew, or reasonably should have known, that they had to do something about the problem," said Mr. Wright, who now practices law in California. "I think the manufacturers are going to contend, obviously, that it was at an early date. And school districts are going to contend that it was at a late date."
According to Mr. Wright, one of the biggest boons of the Pennsylvania case is that it has given schools more time. Judge James M. Kelly temporarily "stopped the clock" in January 1983, when he first received the request for a class action. The clock will start running again only after he disposes of that request.
Moreover, any plaintiffs who litigate their claim as part of the class action could consider their suit filed on the day that the class action was filed in January 1983.
"That suit may have turned out to have saved the claims of just hundreds or even thousands of school districts around the country" that had not filed a lawsuit before that date, said Mr. Wright.
Daniel Berger, a lawyer for districts in the case, agrees. "Even if the class were rejected at this point," he said, "we have given every school in the United States a year and a half of a hiatus in which the statutes of limitation could have been running."
The 1981 attorney general's report noted: "Because of the time elapsed since installation of the asbestos, usually at least nine years, statutes of limitation constitute potential obstacles to recovery. However, the asbestos manufacturers continue to contend that friable asbestos in schools is not dangerous. The manufacturers are faced with the dilemma of, on the one hand, arguing that the danger was obvious so as to commence the running of a 'discovery' or 'manifestation' statute of limitation, while, on the other hand, denying, even today, that the product is dangerous."
How statutes of limitation affect a school's right to recover money from asbestos manufacturers is only one of many questions that Mr. Berger says the court should consider in a class action. Those questions are at the heart of school-asbestos litigation. They include, but are not limited to:
Whether asbestos-containing products in schools create an unwarranted health hazard to schoolchildren and school employees.
Most manufacturers take the position that the low level of asbestos exposure in schools is not a risk, or that if it is a risk, it is an "acceptable" one in a society that is not risk-free, according to Lawrence T. Hoyle Jr., co-liaison counsel for the defendant manufacturers in the Pennsylvania case and a lawyer with the Philadelphia firm of Schnader, Harrison, Segal, and Lewis.
Whether schools are entitled to restitution for the remedial actions that they have taken.
Until courts determine when asbestos poses a health hazard, defendants can argue that schools have "overreacted" and spent money above and beyond that necessary to abate the problem, said Mr. Berger.
Whether asbestos companies, be-cause they engaged directly or indirectly in the manufacture, production, selling, or other placing of products that contain asbestos in the stream of commerce, now have a duty to inspect for, analyze, contain, or remove these products from the school buildings.
Generally, school districts have asked asbestos companies to compensate them for funds that they have already spent to address the asbestos problem. It is not clear whether "we could require the industry to go in there on a reasonable basis all over the country and correct the problem in the next couple of years," said Mr. Berger. Because more and more schools are going ahead with asbestos enclosure and removal projects, Herbert B. Newberg, co-lead counsel in the Pennsylvania case, said that requesting manufacturers to actually undertake abatement programs is "largely a thing of the past."
In addition, schools or school districts would have to prove the primary facts upon which product liability is based, such as failure to warn and to test.
The court's decisions on questions such as these could make the Pennsylvania case a "landmark" that addresses some of the most important issues of the time, according to Mr. Berger.--lo