UK Court rejects Diageo appeal to dismiss black fungus lawsuit

[Erik Owens]

By Melita Kiely https://www.thespiritsbusiness.com/2024/01/judges-reject-diageo-appeal-to-dismiss-black-fungus-lawsuit/

Diageo has lost its appeal to dismiss a lawsuit brought against it by a couple claiming their property has been damaged by angels’ share vapour from whisky warehouses.

Thomas and Gail Chalmers, who live in Bonnybridge, Scotland, first sought legal action in 2014.

The Chalmers’ house sits approximately 350 metres from Diageo’s warehouses in Bonnybridge.

The pair alleges the ethanol vapours from the warehouses – known commonly as the angels’ share – have produced black fungus, also known as baudoinia, which has damaged their house.

In a court hearing last year, the Chalmers were granted permission to pursue legal action against Diageo for allegedly damaging and devaluing their home.

The Chalmers paid £139,950 for their house in 2002. This was revalued in May 2017 to be worth £190,000-£195,000.

The couple argues that the value of the house has been reduced by approximately 5% to 10% due to the effects of the fungus on properties in the area.

Diageo has always contested the allegations. The case was heard in the Second Division, Inner House, Court of Session on 19 January, before the Lord Justice Clerk, Lady Dorrian, sitting with Lord Matthews and Lord Armstrong.

Johnnie Walker owner Diageo sought to have the damages action dismissed, or for certain statements, and awards of expenses in the Chalmers’ favour to be excluded.

In last year’s legal proceedings, the judge said: “It is clear, even without reference to the pleadings about the testing of samples, that the growth of baudoinia, causing deposits or staining, is central to the pursuers’ case.”

In the most recent ruling, Lady Dorrian said: “We agree with the Lord Ordinary [judge] on this matter with her comment that ‘there is no lack of clarity as to the case the defenders [Diageo] have to answer’.”

A Diageo spokesperson said: “We are disappointed with the court’s decision and will continue to defend ourselves vigorously in these proceedings.”