The Corporate Manslaughter and Corporate Homicide Act 2007 - Essay Example

Why was the Corporate Manslaughter and Corporate Homicide Act 2007 felt to be necessary? How has this legislation been received by academic and other commentators? Critically discuss. The Corporate Manslaughter and Corporate Homicide Act 2007 was enacted to address the problem associated with the apportioning of corporate liability. In order to determine why the changes were necessary it will necessary to examine the way in which the courts dealt with such issues prior to the introduction of the Act. This study will look at how charges for breaches of health and safety issues by companies were brought and then compare that with the available powers afforded to the courts by the new Act. Prior to the Act, blame was apportioned by identifying the controlling mind of the company. Charges had to be brought under involuntary manslaughter due to the inability to prove mens rea for a charge of voluntary manslaughter. In order to prove involuntary manslaughter the courts had to prove that there had been gross negligence on the part of the company. This required the proof that the death was caused by an act or omission of the company leading directly to the death of the individual. Identification of the controlling mind would lead to that individual being charged with gross negligence manslaughter1. Wells (1993) 2 identified that a company could be guilty of a criminal offence, but that the legislation was too restrictive for an individual to be able to bring the company to justice. The law in relation to manslaughter places a requirement on the claimant to identify a specific person who can be held responsible for the offence. Coffee (1981) 3 commented that within a company there is ‘no soul to be damned and no body to be kicked.’ In order to circumvent this problem, prosecutions could be brought if an individual could be identified as the ‘controlling mind’ of the company. It was suggested by Clarkson (1996)4 that in some cases the acts or omissions of an employee might be able to be attributed to the company, thereby making the employer liable under the rules regarding vicarious liability. In HL Bolton (Engineering) Co Ltd v TJ Graham and Sons Ltd [1957]5 Lord Denning LJ stated that A company may in many ways be likened to a human body. It has a brain and a nerve centre which controls what it does. It also has hands which hold the tools and act in accordance with directions from the centre. Some of the people in the company are mere servants and agents who are nothing more than hands to do the work and cannot be said to represent the mind or will. Others are directors and managers who represent the directing mind and will of the company and control what it does. The state of mind of the managers is the state of mind of the company and is treated by the law as such. Identification of the ‘controlling mind’ within a small company was less problematic then identifying the ‘controlling mind’ in a larger company. This ‘controlling mind’ could be a director, manager or even an employee of the company. Within a larger company the directors are often so far removed from the business of the company that the courts found it difficult to advise the directors as the ‘controlling mind’. Long before the Act was introduced, the courts recognised the need for an amendment to legislation to assist in apportioning liability in larger companies6. In P & O European Ferries (Dover) Ltd (1991)7 the court was asked to decide whether the company as a whole could be held liable for manslaughter. Mr Justice Turner found himself limited by the need to identify the ‘controlling mind’ and as a result the accused was acquitted. Conversely in R v Kite and OLL Ltd8 charges were able to be brought against the managing director of the company as the prosecution could show that he was directly involved in the day to day running of the centre. Swinton LJ stated that he had experienced difficulty in finding the defendant guilty in this case commenting that Very often, to the families of the deceased young people, no sentence can be too long in the light of what has happened. On the other hand, one has a man who has been convicted of an offence in relation to which he had no criminal intent and who finds it difficult to understand why he has been sent to prison at all. The court had to hold a balance between these two extreme positions. In some cases, the ‘controlling mind’ has been determined through delegated management as was applied in Tesco v Nattrass9. However, the court found the delegation of duties to the store manager failed to satisfy the criteria to make the manager the ‘controlling mind’ of the company. Similarly, in R v Gateway Foodmarkets Ltd10 [1997] the court refused to accept that the management of the store had been delegated to the store at a local level and held the company liable for the death of the duty manager, despite the fact that the head office was unaware of the practices occurring at the local store. It has been argued by Pace (1982)11 that if full responsibility has been delegated to an employee then the employer should be accountable for any harm caused as a result of the negligence of the company under the principle of vicarious liability12. The need for reform through the introduction of the 2007 was fuelled by public attitudes to corporate wrongdoing according to Snider (1991)13. In his study he stated his belief that reform was essential in order to enable companies to be held criminally responsible for their negligent acts. Wells (2001)14 also identified a build up of resentment by members of society for the way in which companies had been able to avoid liability. Wells felt that this resentment had also led to a loss of trust towards such organisations by society. The first step towards apportioning liability on companies came through the Law Commission whose report in 1996 entitled Legislating the Criminal Code: Involuntary Manslaughter15, highlighted the problems they believed were present in the system of corporate liability. The report made recommendations as to the changes needed in order to force companies to accept responsibility for their actions. Following this report, the Home Office in 2000 issued a further report entitled Reforming the Law on Involuntary Manslaughter: The Government’s Proposals16. The focus of both these reports was on creating the offence of ‘corporate killing’. In 2005 the Home Office drafted the Corporate Manslaughter: The Government’s Draft Bill for Reform which was later used to create the 2007 Act above(Home Office, 2005a17). In 1997 the report issued by the Law Commission was analysed by Ridley and Dunford18. Their analysis of the reforms and their own research into the legislation on corporate manslaughter led them to comment that The Commissions proposals are to be commended in that they address a great many difficulties in the application of the existing common law of manslaughter to corporations. In particular, the removal of the requirement of identification from the definition of the offence should indeed increase the likelihood of successful prosecutions (Ridley and Dunford, 1997). It is clear from comments such as this; that support was growing for reforms to be made in the apportioning of liability for corporate manslaughter. Ridley and Dunford did go on to express reservations on the degree of success of such reforms, stating that they believed it was likely that it would be ‘only the most newsworthy cases, which are successfully prosecuted’, due in their opinion to the fact that the ‘jury is required to make a judgment that the conduct of the company’s management fell far below what could reasonably have been expected.’ The report issued by the Home Office in 2000 made a recommendation that if the reforms were to be implemented, the Health and Safety Executive should be given the responsibility of determining the charges to be brought against the company. The Health and Safety Executive was concerned that this might lead to a conflict with their duties towards work related fatalities. These concerns were again raised in 2005 by the Home Office who agreed that there was likely to be a conflict between the investigation of a corporate manslaughter charge with the primary function of the HSE which was to ‘prevent harm’ (Home Office, 2005c)19. The Home Office were concerned that the two roles of the HSE would be in conflict as the primary role was to force companies to adhere to health and safety standards in the workplace, to prevent reoccurrences, and to penalise companies through compensation for any breaches of health and safety legislation. Requiring the HSE to apportion criminal liability would prevent them from being able to enforce changes in the workplace through monetary penalties. From research it was evident that breaches of health and safety legislation can be a primary cause of death related incidents in the workplace. Wells (2001)20 belived that the introduction of ‘corporate killing’ into legislation would act as a deterrent to those companies that flaunted health and safety regulations. Hall and Johnstone (2005) 21 failed to agree that punitive measures could have the desired effect of deterring companies form breaching such regulations. Other researchers, such as Clarkson (1996)22, felt that the legal limitations on manslaughter created an obstacle in bringing actions against companies for liability. The issue was addressed in a report issued by the Home Office in 2005 where they suggested that a ‘liability test’ could be created based on ‘management failure’ (Home Office Report, 2005a). This test would look at whether adequate action had been taken by the company concerned to control health and safety risks in the workplace. The introduction of the 2007 Act was designed to act as a deterrent. It was also hoped that the publication of successful prosecutions of companies charged with corporate manslaughter would help to re-build public confidence in the knowledge that breaches of health and safety leading to fatalities would not be tolerated. This was highlighted in the 2005b publication issued by the Home Office in which Charles Clarke stated that ‘This Government is committed to delivering a criminal justice system that commands the confidence of the public. A fundamental part of this is providing offences that are clear and effective. The current laws on corporate manslaughter are neither, as a number of unsuccessful prosecutions over the years stand testament’ (Home Office 2005b)23. Some researchers, such as Hutter and Lloyd- Bostock (1989)24, felt that the using the media to publicise successful prosecutions would be the most effective way to encourage other companies to be more vigilant in monitoring health and safety within the company. They also believe that accidents and other events which prompt reactive enforcement may result in a greater inclination towards legal action than proactive enforcement strategies. In 2008 the Corporate Manslaughter and Corporate Homicide Act came into effect. The wording of the Act removed individual liability from the equation and allowed claims to be brought against the organisation as a whole. The overall effect of the Act was to place a duty of care on the company and to prevent blame from being apportioned to an individual within that company. Before the introduction of this Act, claimants had to bring an action under the Law Reform (Miscellaneous Provisions) Act 1934 or the Fatal Accidents Act 1976, if an individual could not be identified as responsible for the breach. This could prove problematic as such claims had to be brought within 6 years of the incident. The 2007 Act has removed the time limit, which could be beneficial in situations where investigation into the incident could take in excess of 6 years to complete. Those involved in the construction industry have expressed their concerns about the reforms made by the 2007 Act. This is one industry where there are a significant amount of deaths each year, and the threat of prosecution is unlikely to have a significant effect on the way in which business is conducted, as many such accidents are unavoidable. Hawkins (2002)25 is in favour of the Act stating that such enforcement will give a symbolic message to those who have lost a relative or friend through the negligence of a corporation. Hawkins commented that ‘Prosecution, when viewed as right, proper, and appropriate, is legitimate . . . and can therefore make both an expressive claim founded in moral legitimacy and an instrumental claim derived from action in the public interest. It seems from the above, that the reforms were necessary given the difficulty in identifying the controlling mind of a company. The ability to find the company as a whole liable for the deaths is likely to be welcomed by those that have been affected by corporate negligence in the past. However, despite the availability of bringing such claims against companies, the legislation has yet to be used in this manner. Until there are a significant number of successful cases for corporate killing it is impossible to judge the effectiveness of the Act. It could be argued that the threat of prosecution has made companies more conscious of health and safety issues, which is why there has been no need to use the new Act. If this is the case, then the Act could be regarded as being a success as it has prevented deaths caused by corporate negligence. Although compensation for the families of victims will be easier to achieve under the Act, many of those affected by the negligent act are likely to be dissatisfied by the result. Prior to the Act, an individual would be likely to be given a prison sentence for their part in the negligent act. Since the enactment of the Act, the only penalty available is monetary compensation. References Almond, P, An inspectors-eye view: the prospective enforcement of work-related fatality cases, British Journal of Criminology, 2006 Barrett, B, Liability for safety offences: is the law still fatally flawed?, Industrial Law Journal, 2008 Clarkson, C. (1996), ‘Kicking Corporate Bodies and Damning their Souls’, Modern Law Review, 59: 557. Clarkson, C.M.V, Corporate manslaughter: yet more Government proposals, Criminal Law Review, 2005 Coffee, J. C. (1981). No soul to damn, No body to kick: An unscandalized inquiry into the problems of corporate punishment. Michigan Law Review, 79, 386–459. Cooper, J, The Sentencing Guidelines Council - a practical perspective, Criminal Law Review, 2008 Glazebrook, P R, A better way of convicting businesses of avoidable deaths and injuries?, Cambridge Law Journal, 2002 Glazebrook, P. (2002), ‘A Better Way of Convicting Businesses of Avoidable Deaths and Injuries?’, Cambridge Law Journal, 61: 405. Gobert, J, Corporate killing at home and abroad - reflections on the Governments proposals, Law Quarterly Review, 2002 Hall, A. and Johnstone, R. (2005), ‘Exploring the Re-Criminalisation of OHS Breaches in the Context of Industrial Death’, Flinders Journal of Law Reform, 8: 57. Harris, J, The Corporate Manslaughter and Corporate Homicide Act 2007: unfinished business?, Company Lawyer, 2007 Hawkins, K. (2002), Law as Last Resort: Prosecution Decision-Making in a Regulatory Agency. Oxford: University Press. Home Office (2000), Reforming the Law on Involuntary Manslaughter: The Government’s Proposals. London: HMSO. Home Office (2005a), Corporate Manslaughter: The Government’s Draft Bill for Reform. London: The Stationery Office. Home Office (2005b), Press Release 062/2005: ‘Tough New Laws on Corporate Manslaughter’, available online at www.homeoffice.gov.uk/pageprint.asp?item_id=1278. Home Office (2005c), Corporate Manslaughter: A Summary of Responses to the Home Office’s Consultation in 2000, available online at www.homeoffice.gov.uk/docs4/cs_corp_mans.pdf. HSE (1988), Blackspot Construction. London: HSE. HSE (2001), Health and Safety Offences and Penalties 2000–01. London: HSE. HSE (2004), Health and Safety Statistics Highlights 2003/04. London: HSE. Hutter, B. and Lloyd-Bostock, S. (1989), ‘The Power of Accidents: The Social and Psychological Impact of Accidents and the Enforcement of Safety Regulations’, British Journal of Criminology, 30: 409. Law Commission (1996), Legislating the Criminal Code: Involuntary Manslaughter, Report 237. London: HMSO. 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