Martinisation (London) Limited Director Jailed For 14 Months Following Workers’ Deaths

24/07/2017

On 7^th July 2017, the director of construction company Martinisation (London) Limited (MLL), Martin Gutaj was jailed for 14 months for two breaches of section 37 of the Health and Safety at Act 1974, after two workers died trying to haul a sofa onto a first-floor balcony on 21 November 2014. He was also disqualified from being a company director for four years.

The company, was fined £1.2 million following conviction on two counts of corporate manslaughter, pursuant to section 1(1) of the Corporate Manslaughter and Corporate Homicide Act 2007, and breaches of sections 2 and 3 of the Health and Safety at Work Act 1974. Shortly after the prosecution was announced by the Crown Prosecution Service MLL went into liquidation being owed more than £4 million following negative publicity.  

The background to the case

Tomasz Procko, 22 and Kyrol Szymanski, 29, both Polish nationals were working on the renovation of a flat  in Cadogan Square, one of London’s most expensive streets, run by Gutaj’s company. At the time of the incident the renovation was almost complete with only ‘snagging’ works to be done.

Both men, along with three others, used ropes to try to haul a 11 foot sofa, weighing 18 stone, which had been delivered earlier that morning,  over a balustrade and into a first-floor apartment. There does not appear to have been a specific instruction to the men in relation to this sofa.  Mr Gutaj was not on site when the accident occurred. 

The court heard that no risk assessment was undertaken in relation to this operation and that none of the men had received adequate training in manoeuvring heavy objects at height.  A specialist delivery company had offered to deliver the sofa using an outside elevator for a total cost of £848, but this was declined by t Mr. Gutaj.

Witnesses stated that as the group of unsupervised men were pulling the sofa up towards the balcony, it gave way.  The weight of the sofa pulled the two men to their deaths.  A third man was saved from the edge of the balcony by his colleagues.

Mr. Procko suffered catastrophic injuries and died at the scene while Mr. Symanski died in hospital a short while later.

Comment

Since the Corporate Manslaughter and Corporate Homicide Act 2007 came into effect almost a decade ago there have been only 24 convictions.  To secure a conviction under the 2007 Act the prosecution must prove that the defendant company’s gross breach of duty that led to death was substantially due to the way in which its activities were managed or organised by its senior management. This requirement to demonstrate causative senior management failure has meant that most of these convictions have been of small firms like MLL where it is much easier to prove this element of the offence.

This case is an example of the growing trend to prosecute directors and senior managers alongside their companies for offences arising from alleged corporate health and safety breaches.  To convict an individual under section 37 of the Health and Safety at Work Act 1974 the prosecution must first prove that the company was in breach of health and safety law and secondly that this corporate breach was due to the consent or connivance of the defendant or was attributable to the defendant’s neglect.  

Custodial Sentences For Individuals

According to a Financial Times report, in the year ending 31 March 2015 there were 15 section 37 prosecutions of company directors and senior managers but that in the year ending 31 March 2016 this had risen to 46, a threefold increase.  Added to this the Sentencing Guidelines for Health and Safety, Corporate Manslaughter and Food Safety and Hygiene Offences came into effect in February 2016 lowered the bar for custodial sentences for individuals convicted of healtrh and safety offences. A director or senior manager is now likely to receive a custodial sentence if he/she is convicted of section 37 where the prosecution follows a fatality. 

It is of course important that directors and senior managers regularly review their health and safety arrangements and supervision. As this case demonstrates, even though the vast majority of the renovation work had been completed, a serious incident can still occur during the final stages of a project, when the risks may not appear so obvious.

In these types of cases it is essential that specialist legal advice is sought early on. Directors and senior managers should therefore give thought to how the legal costs of their company and its senior individuals will be met if there is a criminal investigation by the police and/or the Health and Safety Executive. 

So it is advisable to review the company’s insurance position. It may be prudent for separate cover to be taken out for the legal costs of senior individuals such as a D&O policy (Directors’ and Officers’ liability policy).  It should be noted that an acquitted director or senior manager can only recover a contribution to their legal costs in limited circumstances.

Questions directors and senior managers might wish to ask their insurers and brokers when reviewing cover may include:

• Will cover be provided during the criminal investigation? Some policies do not cover legal costs until there is a prosecution.          

• Does the policy cover both manslaughter and health and safety prosecutions?          

• If providing legal costs for a defence to criminal charges is at the insurer’s discretion, under what circumstances will the insurer exercise discretion?          

• If there has been no physical injury will there still be cover? As the Sentencing Guidelines for Health and Safety, Corporate Manslaughter and Food Safety and Hygiene Offences points out, health and safety law is concerned with the exposure to risk.  Therefore a health and safety breach can occur where there has been no accident.           

• Where cover for the criminal case is provided as part of a policy that covers personal injury claims (eg under an Employers’ Liability policy) an insurer may only exercise its discretion while there is an ongoing related personal injury claim.  In those circumstances it is worth enquiring whether cover for the costs of the criminal case will continue if the personal injury case is settled before the criminal trial takes place.    

The Right To Choose

Insurers may insist that a firm of solicitors from its panel of law firms (that often comprises firms that deal with its personal injury claims) is instructed in the criminal case. However a policy holder has the right to choose his/her own solicitor under Regulation 6(1) of the Insurance Companies (Legal Expenses Insurance) Regulations 1990. Any insurance policy, such as an employers’ liability policy, public liability policy or D&O policy that provides cover for legal expenses comes within the 1990 Regulations.