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Claims management company wins miners' compensation battle

24 August 2009

A claims management company owned by the UDM (Union of Democratic Mineworkers) does not have to repay fees charged to a non-union member for handling his compensation claim, the High Court has ruled in a test case.

Brian Strydom, who worked as a miner at Thoresby colliery in Nottinghamshire, left the UDM in 1997, a year before he signed an agreement with the company under which he would pay a fee of up to £300 plus VAT.

Delivering judgment in Strydom v Vendside [2009] EWHC 2130 (QB), Mr Justice Blair said that Strydom’s QC did not suggest that the “public concern” over the amount of money paid to legal advisers for handling claims from the state-run miners’ compensation scheme was relevant to this claim.

“Whatever the underlying considerations may be, to succeed on the appeal, the claimant has to show that his claim is soundly based in law,” Mr Justice Blair said.

“In essence, the claimant says that it is unfair that he should have to pay for the defendant’s claims handling service when the DTI was already paying for it, a fact that was not disclosed to him at the time he entered into the contract, or indeed afterwards.”

The judge went on: “He argues that in these circumstances, the court should find a way to allow the claim, by implying a term that enables recovery of the amount he paid, or alternatively by setting the contract aside as an unconscionable bargain.”

Blair J said that the company argued that Strydom would have paid nothing if he had remained in the union and that he had got what he bargained for.

“The union successfully pursued the claim and it would be unfair to allow him to recover the fee which he agreed to pay in such circumstances.”

Mr Justice Blair said he did not consider the “legal threshold for the implication of terms” was satisfied.

On the issue of whether the agreement was unconscionable, the judge said that while he had “considerable sympathy” with the claimant’s submissions, the claimant had to pay a fee because he was no longer paying his union dues.

He said the fee was “payable only in the event of a successful settlement, and it was capped at £300.

“It is correct that the union was also to receive a fee from the DTI, and that this activity turned out to be very profitable given the number of claims that were handled. But legitimate public concern on this ground does not render the contract ‘oppressive’ in the legal sense as regards the claimant.”

Mr Justice Blair dismissed the appeal.

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