‘Manifestly Excessive’ Health and Safety Fine Overturned By Court Of Appeal

07/06/2018

R (on the application of Health and Safety Executive) v ATE Truck & Trailer Sales Ltd [2018] EWCA Crim 752 

The Court of Appeal has overturned a ‘manifestly excessive’ fine in the recent case of R (on the application of Health and Safety Executive) v ATE Truck & Trailer Sales Ltd.  Although the case relates to a health and safety breach, the principles could be equally applied to an environment law fine.

It was held that the court was expected to encourage and carefully consider a basis of plea and sensible agreement by the parties.  However, such an agreement is not binding, and in this case there was insufficient justification for departing from the parties' agreement, and a fine of £475,000 following a company's guilty plea to an offence under the Management of Health and Safety at Work Regulations 1999 reg.3(1)(a) was reduced to £200,000.

The facts of the case

This case involved the death of a contractor who was working independently from ATE Truck & Trailer Sale’s employees.  The contractor was dismantling the roof section of a trailer when part of it hit him.

After undertaking an investigation, the Health and Safety Executive decided that the method under which the contractor was working was inherently unsafe.  They observed that the employees of the company dismantled trailers using a different method.  In addition, although the organisation had health and safety procedures in place, a risk assessment for dismantling trailers did not exist.

On this basis, ATE Truck & Trailer Sales pleaded guilty.

In relation to the Definitive Sentencing Guideline on Health and Safety Offences, Corporate Manslaughter and Food Safety and Hygiene Offences (the Guidelines), the HSE and the company agreed that the offence was low culpability, Level A harm, and had a more than minimal, negligible or trivial connection with the accident leading to the contractor's death, but that it was not a major cause.  The parties disagreed on the likelihood of harm, with the HSE stating it was medium and the company arguing it was low.  The only criticism the HSE had of ATE Truck & Trailer Sale’s dismantling method was there was no written risk assessment.

In calculating the fine, the judge at first instance went against the parties’ agreement, declaring that culpability and the likelihood of harm were both high.

ATE Truck & Trailer Sales appealed.

The decision

The Court of Appeal reduced the fine and outlined several steps to be taken by the court when undertaking the sentencing process.

• The court does not have to concur with the agreement made between the parties; however, a sensible agreement was to be encouraged, and the court must weigh it carefully before departing from it.          

• Because the company’s guilty plea was based on a causal link between not having a suitable risk assessment for dismantling trailers, which naturally led to a failure to communicate that risk assessment to the contractor (after all, it did not exist), the judge had to examine the method of work followed by the employees rather than the contractor.          

• No justification existed for categorising the case as high culpability.  The judge had assessed culpability by reference to the method adopted by the contractor. That was not in accordance with the basis of plea and drifted into a separate count where neither party had produced evidence.  The only criticism made by the HSE was on the basis of the absence of a risk assessment.          

• The absence of a risk assessment meant there was a risk of harm, and, given the harm risked was death, the case fell into Level A in accordance with the Guidelines.  However, the Court of Appeal noted when assessing culpability, the sentencing judge appeared to have been influenced by consideration of the contractor’s method of work rather than that of the company’s.          

• Focusing on the contractor’s method of work rather than that of the company’s employees led to the judge making an error in holding that para.2(i) of the Guideline, namely whether the offence exposed several workers or members of the public to harm, applied.  Even in the absence of this mistake, there was scant evidence to show the contractor’s work had exposed several workers or members of the public to harm.  However, the fact a person had died and the company’s breach was more than a minimal, negligible, or trivial cause of that death was a significant aggravating factor that could result in a move to the top of the next category range contained in the Guidelines.

The court concluded that the company was a medium organisation in turnover terms and the case was low culpability falling within harm category 2.  The starting point was, therefore, a fine of £40,000, with a range of £14,000 to £100,000. To reflect the application of para.2(ii) and to have a significant economic impact, the right course was to move harm to the top of the range for category one harm, namely £300,000.  The figure was then reduced by one-third to take account of the guilty plea which amounted to £200,000.

The Court of Appeal followed R v Whirlpool UK Appliances Ltd [2017] EWCA Crim 2186, [2018] 1 Cr. App. R. (S.) 44 which held that if a death occurred, the sentence would substantially increase, even in cases of low culpability and low likelihood of harm.

Lord Burnett of Maldon CJ stated in Whirlpool:

“Nothing in this judgment is intended to alter the policy in this Court in recent times (consolidated by the Sentencing Guidelines Council) of ensuring that organisations are made to pay fines that are properly proportionate to their means. That, of course, does not relieve the Court of a duty to enquire carefully into the facts of each case so as fairly to reflect different levels of harm and culpability. The circumstances of this case are unusual in flowing from an offence of low culpability and low likelihood of harm. Had they involved any increased culpability or likelihood of harm the appropriate fine would have been very much larger. No two health and safety cases are the same. The Guideline provides for very substantial financial penalties in appropriate cases, particularly when the offender is a large or very large organisation. Yet it is subtle enough to recognise that culpability, likelihood of harm and harm itself should be properly reflected in any fine, as well as turnover. The same degree of actual harm following a breach of section 2 or 3 of the 1974 Act can deliver very different fines depending on the circumstances. That is obvious when one considers the table we have reproduced in paragraph 10, with its wide range of potential fines for the same offence”.

This case illustrates that the courts will still look at each sentencing decision with its own eyes, and not necessarily follow any agreement made by the parties.