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    Parent companies are accountable for activities of subsidiaries

    Parent companies are accountable for the activities of their subsidiaries, the Court of Appeal had held in a ground-breaking judgment. 

    David Chandler brought a claim after he contracted asbestosis as a result of a short period of employment more than 50 years ago with Cape Building Products Ltd, which is no longer in existence.  Its parent company, Cape Plc, still exits.  For chandler’s claim to succeed, his lawyers needed to show Cape Plc owed a direct duty of care to the employees of its subsidiary to provide a  safe system of work. 

    Giving judgment in Chandler v Cap Plc [2012] EWCA Civ 525, Lady Justice Arden said: “We understand that this is one of the first case in which an employee has established at trial liability to him on the part of his employer’s parent company, and thus this appeal is of some importance not only to the parties but to other cases.”

    “New Law Journal” 4.5.12