Follow this blogWhat Lion Steel tells us about Corporate Manslaughter
I spent some time over the last couple of weeks marking health and safety law masters assignments. One of the questions asked students to examine the introduction of the Corporate Manslaughter and Corporate Homicide Act introduced in 2007 particularly in comparison to the common law offence it replaced*. Sensibly all of the students correctly identified a succession of high profile cases under the old common law that failed due to the absence of a directing mind within the organisation that could be be said to have be grossly negligent. Most highlighted the need to see the outcome of the third case brought under the new Act, under way at the time, involving Lion Steel, a company large enough to almost certainly have escaped under the old offence.
As well as being charged under the Act, three of the firms directors were charged with gross negligence manslaughter, implying a continued connection with the actions of individuals that the Act was supposed to resolve. However at the start of the trial, on the 12th June, the corporate manslaughter offence was severed from the others due to the timing of evidence applicable to both health and safety and corporate manslaughter offences. This left the trial continuing with the individual manslaughter and section 37 health and safety offences, as well as the company’s health and safety offences. It came to a conclusion this week with the judge ordering the individual charges against two of the directors to be dropped, and the prosecution then dropping all remaining charges in return for a guilty plea for corporate manslaughter.
In one sense this resolves finally the need to identify guilty individuals when holding the company to account. Hooray for that I hear you say, the identification doctrine is no more. However in dropping the health and safety offences, particularly the section 37 offences against the directors that would have resulted in them being disqualified from being a company director, the worst critics of the new Act may come back to haunt it. In short this leaves a company whose activities were managed in such a serious way that they resulted in the death of one of its employees still being run by the directors who oversaw the ‘senior management failure’ that by way of its guilty plea can be deemed to have contributed to the offence.
I imagine the experience of being put on trial for gross negligence manslaughter will have such an effect on the individuals that health and safety will rise up their list of priorities, however the message that this sends to other organisations and their directors is seriously compromised. Sure, Lion Steel are in for a significant fine which could be accompanied by a publicity order, but there will be those that will examine this case and think the Act has failed. Despite it being a success.
Footnote – I spent a day in court following the trial. At the end of the days hearings, which mainly involved expert witnesses on roof access, the judge summed up the progress so far. “It would seem clear that this case revolves about the extent of knowledge people had about what was going on” he said. Nobody on either bench disagreed with him.
*in order to find a corporate body guilty of manslaughter an employee also had to be found guilty of gross negligence manslaughter with that employee being sufficiently influential as to have acted as directing mind of the whole organisation. In practice this limited the chance of successful prosecution to very small companies. See R v Kite and OLL Ltd 1994.
8 Comments for this entry
John Hamilton
Hi Ray, thanks for the comments. I agree with your comments regarding individual liability which is why the lack of it in the Act has been shown up in this case, particularly given the failure of the s37 charges. I appreciate the lack of direct connection between a s37 offence and directors disqualification, but one would imagine it would face little opposition when associated with a corporate manslaughter conviction.
Your observation regarding Lion Steel’s size is interesting. Many observers would deem the Act a success in that Lion Steel would almost certainly have escaped prosecution under the old common law. However you’re correct to highlight the main aim of the Act being to hold much larger organisations to account, and on that we still wait. It will be interesting to see how it unfolds. John
Nick
I was involved in this case, and i am shocked at how long this took to get to court, I am also shocked that the insurance brokers and insurance company have not had any action taken against them. Because in my own opinion their actions also lead to this company to neglect health and safety. We will have to see now what sentence and actions and fine the judge will enforce on the 19 July.
John Hamilton
Interesting insight Nick, thanks. There are a number of unsatisfactory aspects of this case, not helped by the glare that we’ve all put on it. It’s probably too early to judge the efficacy of the Act given the unique nature of this case. I dare say the HSAWA had its critics in the early days but in time as the judiciary got warmed up we know how effective it proved in the end. It’s worth remembering that much of the definitive case law came many years after it was enacted.
Nick
one of the worst things about this case was the health and safety officer, he made notes at the time of his visits ect to the company, but as nothing had happened after 6 months he destroy his notes what apparently is a common practice for them to do, and i am glad the judge said to him that they needed to change that.
Donald Gray
It’s sad that more countries do not enforce a corporate manslaughter law. Hong Kong for example will fine a construction company and remove them from tendering lists for a period of up to a year for fatal accidents. China has a stiffer approach compensation paid by the owner to the family and jail!
Nick
Lion Steel Limited – the third company in the UK to be convicted under the Corporate Manslaughter Act – has been fined £480,000 with costs of £84,000.
The fine, which is the highest so far under the Corporate Manslaughter Act, is payable up to 30 September 2015, with the costs payable within two years.
i bet they go bankrupt and start up under a different name. Just hope now the family can get on with there life’s now
Ray Rapp
John, first and foremost that directors fear personal liability more than corporate liability. Second, doing a deal with the CPS will result in a director not facing gross negligent manslaughter.
The CMA has still much to prove, thus far Lion Steel is the largest company to be ‘successfully’ prosecuted. Yet, it is still as SME and a long way from its intended purpose – to remove the corporate veil from MNEs.
ps A conviction pursuant to s37 does not automatically result in a director being disqualified. It must be requested either by the enforcing authority or imposed by court – normally the latter.
Ray