More than 300 people bought sofas from Land of Leather. Now, you imagine that everything that followed would be mainly sitting down based anecdotes. However, these poor sods had bought ‘toxic’ couches and ended up with rashes and burns.

Not what you’d expect from a piece of furniture, eh?

So in come the compensation cheques? Fat chance. Apparently, not one of them will get a penny for their bother a high court judge ruled yesterday.

The sofas were manufactured by a company called Linkwise using the chemical dimethyl fumerate, which is used as an anti-mould agent. However, it caused all manner of skin complaints and in one particularly unfortunate case, one woman had her dog killed at the vets because she thought it was the reason her skin had gone weird.

Gutted.

The chemical has since been banned after people all over Europe suffered skin burns and breathing problems, according to Russell Jones and Walker, the solicitors which represented the claimants.

Alas, Land of Leather went bust last year, so its customers took the company’s insurer, Zurich, to the high court to sue for up to £3m in compensation.

But Mr Justice Teare told them to get bent.

Richard Langton, senior litigation partner at Russell Jones and Walker, who described the ruling as a “devasting blow”, said a clause in Land of Leather’s insurance policy had allowed Zurich to avoid paying compensation.

“The contract contains one condition which, if breached, rendered the insurance policy void. This condition was that Land of Leather should not settle claims without permission from the insurer,” he said. “When Land of Leather realised Linkwise sofas were damaging its reputation, it sought compensation from Linkwise, and the company agreed to pay Land of Leather $900,000. Zurich was consulted on and agreed to this.

“But Linkwise then failed to pay up, so Land of Leather went back for more discussions. They slightly changed the terms of the agreement and Linkewise paid the $900,000, but this time Zurich was not consulted, which the insurer said rendered the insurance null and void.”

A spokesperson for Zurich said the high court ruling confirmed that Land of Leather had breached “fundamental terms” of its insurance policy, which meant it did not provide an indemnity for customers injured by the Linkwise sofas. They added: “Zurich remains committed, wherever possible, to the prompt resolution of personal injury claims unaffected by today’s ruling. As the group litigation in relation to such claims is ongoing, it is not appropriate to make further comment at this time.”

[Guardian]

The flags have been lowered to half-mast at Bitterwallet, as we contemplate saying goodbye to our fourth favourite childhood foodstuff. Newcastle Productions, who produce products under the Findus brand – they of the now legendary crispy pancake – have called in the administrators. According to union chiefs, the company had money wrapped up in Icelandic banks, who are forcing the administration. The firm employs 420 staff in Newcastle.

Meanwhile news agency Reuters is reporting that suite manufacturer Land of Leather has called in Deloitte (who are getting an incredible amount of work out of this financial crisis, don’t you think?) to sell the business as a going concern; shares in the company were suspended this morning. 106 stores and 800 staff are at risk as this new front opens up in the continued demise of UK businesses; there are several similarly sized sofa retailers that have struggled to continue trading in recent years.

A further 875 jobs are at risk at distribution company Wincanton which is threatening to close two depots is Gloucester and Salford, but it’s not all doom and gloom: Morrisons is pledging to create 5,000 jobs across its UK supermarkets in the next 12 months, after predicting a 12 per cent rise in sales over the Christmas period.