Chapter 11 asbestos trusts are uniquely suited for and too often used for implementing lousy public policy.
How so? Years after most agreed that it’s social folly to pay compensation to a pure non-malignant claimant, many of the trusts are used to attract and pay material amounts of non-malignant claims.
Proof ? This prior post covered the topic back in June, 2009. Recent examples are the most recent pair of the Manville Trust’s quarterly, minimalist reports to the Court. The first quarter report is here, and the second quarter is here. You also can obtain quarterly reports online at this page of the Manville Trust, but they are posted to the website no little time after submission to the Court.
The reports make plain that non-malignant claims continue to be asserted and paid significant amounts of money that should instead be paid to persons with cancers or other conditions.
The first quarter report, for example, states:
"For the first quarter of2011 the Trust settled approximately 11,600 claims for $38.4 million compared to 5,400 claim settlements for $27.9 million for the same time period in 2010.
The average settlement amount for the first quarter of2011 and 2010 was approximately $3,300 and $5,100, respectively. The lower average settlement amount in the first quarter of2011 is dueto settling a larger percentage of non-malignancy claims when compared to the first quarter of2010, though 76% of all claim payments during the quarter were paid to claimants with a malignancy disease."
The second quarter report states:
For the second quarter of 2011 the Trust settled approximately 8,700 claims for $39.5 million compared to approximately 4,000 claim settlements for $29.0 million for the same timeperiod in 2010. The average settlement amount for the second quarter of 20 II and 2010 was approximately $4,600 and $7,200, respectively. Claim filings for the second quarter 2011 were approximately 9,300 compared to 4,600 for the second quarter 2010. Year to date the Trust has received over 20,800 claims compared to 8,900 claims for the first six months of 2010.