Corporate Manslaughter and Corporate Homicide Bill

My Lords, this Friday, 22 December, sees the seventh anniversary of the deaths of the Findlay family, from Larkhall in Lanarkshire. The family was made up of Andrew and Janette, and their two children, Stacey, who was then 13, and Daryl, who was 11. There will be many in Scotland who will see today’s debate as a timely tribute to them and to those in Scotland who have campaigned for a change in the law. I hope that noble Lords will forgive me if I address the issue before us on the basis of the law in Scotland and that some of the principles that I address are common also to England and Wales. Following a full investigation, it was ascertained that the explosion was due to gas leaking from a corroding pipe into the family bungalow. As a result of that gas leak, an explosion occurred, which devastated the house and killed the occupants. Transco, which, with its predecessors, was responsible for the maintenance of the pipe, was indicted in the High Court of Justiciary on a common-law charge of culpable homicide and on contraventions of Sections 3 and 33 of the Health and Safety at Work etc. Act. Transco took a plea to the competency and relevancy of the charge of culpable homicide. At first, that plea was repelled but, on appeal, the plea to the relevancy of the charge of culpable homicide was upheld. Three important things emerged in the judgment of the Appeal Court. The first was that, in common law in Scotland, it is competent to charge a corporation with culpable homicide. Secondly, however, in order to make a relevant charge, the prosecution must be able to identify a controlling mind with the necessary mens rea, as we call it in Scotland, or criminal intent, which one can attribute to the company. Thirdly, it is not permissible to aggregate the states of mind of various individuals who may, at one time or another, have been the controlling mind of the company—at least, in relation to the activities that gave rise tothe death. As it was conceded by representatives of the Crown that they could not point to a single individual with a controlling mind attributable to the company, the charge of culpable homicide was held to be not relevant. Transco was subsequently prosecuted on contraventions of Sections 3 and 33 of the Health and Safety at Work etc. Act and, after a lengthy trial, was found unanimously guilty. I say to the noble Earl, Lord Mar and Kellie, that I do not think that there is any difficulty in juries bringing a guilty verdict to corporations or corporate bodies where the evidence clearly points to that effect, which of course was true in the Transco case. As we heard from my noble friend Lord Brennan, the fine imposed was £15 million—a record which still stands in the United Kingdom for breaches of the Health and Safety at Work etc. Act. To put it into context, I understand that the fine in the Ladbroke Grove case was about £2.5 million, which, at that stage, was the highest ever levied in the United Kingdom. In addition to the points made by my noble friend Lord Brennan, I mention that, in passing judgment, Lord Carloway commented that Transco had shown no remorse. It would be entirely wrong to speculate about what might have happened had Transco been prosecuted for culpable homicide, but it is legitimate to look at the judgment and the case and to ask what lessons can be learnt and whether there is any guidance for the legislature. The first question to ask is whether, given the level of fine imposed against Transco, it is necessary to create a new offence of corporate homicide when the available financial penalties are the same. Lord Osborne made that point in the judgment in the Court of Appeal, observing that the financial penalties on conviction of an offence under the Health and Safety at Work etc. Act were unlimited. He said: "““It might be thought that the availability of such penalties on conviction would provide sufficient powers for a court to do justice in a case such as the present one. If, however, Parliament considers that a corporate body, in circumstances such as the present, should be subjected, not only to potentially unlimited financial penalties, but also to the opprobrium attaching to a conviction for culpable homicide, then it must legislate””." In my submission, it is important to note that the Health and Safety at Work etc. Act does not distinguish between offences which cause death at work and those which do not. Although that may not be surprising in the context of the purpose of the health and safety at work legislation, many people consider that, where death has resulted from a gross breach of a duty of care, it should be specifically marked by the justice system with an appropriate conviction. Cathy Jamieson, the Minister for Justice in Scotland, established an expert group to look at the development of the law in Scotland on this issue. It pointed to research that showed that companies are shameable. Indeed, they care about their reputation. Many have high ethical standards, or, at least, they claim to do so, and they are willing to spend a lot of money—sometimes disproportionately so in relation to the possible fine to which they might be subjected—in defending prosecutions. I suggest that a new offence will help with deterrence but I believe that, more importantly, it will give a sense of justice to those who have lost family and loved ones as a result of a gross breach of duty by a company. I say, particularly to those who are anxious about the personal liability of directors and others, that I believe that, where we can bring home a guilty verdict against individuals in relation to their responsibility under the health and safety at work legislation or the offence of culpable homicide, it is up to prosecutors to prosecute them individually. Clearly, it will not be appropriate for prosecution under this legislation to take place in every case where death in the workplace occurs but, where the prosecutor is happy that he or she can satisfy the test set out in Clause 1 of the Bill, it should be appropriate to bring prosecutions under the new legislation. Where that test is not met but there are still breaches of the Health and Safety at Work etc. Act, prosecutions can still be brought under that legislation. The second point is that the Transco case confirmed that a corporate body can be guilty of the common-law offence of culpable homicide, provided that a controlling mind whose actions are attributable to the company can be identified. The need to identify a controlling mind is also present in England, and, as has been recognised, the consequence is that it is virtually impossible to bring a successful prosecution against a large corporation, particularly if the allegation is based on a system failure. It is obvious that in a small or medium-sized company, where the number of employees is in the tens or hundreds, it may be easier to identify a controlling mind. I suggest that the present law discriminates against small companies and small businesses, which are, frankly, more at risk of prosecution for manslaughter or culpable homicide, and that that anomaly is sufficient to justify this legislation. Following the Transco decision, there was a campaign in Scotland to change the law. I pay tribute to the work of Karen Gillon MSP, who led the campaign and was tireless in her efforts to remedy what she saw as an injustice with the backing of the STUC and, in particular, Grahame Smith, who I am pleased to see has now been appointed as the organisation’s new general-secretary. However, the report of the expert group, to which I referred earlier, pointed to the difficulties in legislating in Scotland, given the reservations in the Scotland Act about the health and safety at work legislation and business organisations. That caused doubt about whether the Scottish Parliament could legislate in this area. I know that it caused disappointment to many who wanted a Scottish solution. As Lord Advocate, as I then was, my concern was to see a workable offence that would not be subject to challenge by an accused company on the grounds that the Scottish Parliament lacked the competence to legislate. Given that both health and safety and company legislation are UK-based, I believe that there is considerable merit in the offences north and south of the border, if not being the same, then at least being closely aligned. While some in Scotland might wish it were different, this place is indeed part of the legislature for Scotland. There has, however, been substantial criticism of the offence as formulated for Scotland, which I shall address. As drafted, it is based on the concept of a gross breach of a duty of care. The common-law offence of culpable homicide in Scotland is based on gross, wicked or reckless conduct, and it has been suggested that the Scottish offence should retain recklessness as a foundation. I do not believe that there are difficulties for Scots law with the way in which the offence is formulated in the Bill. It is a new, standalone offence, using the familiar concept of a duty of care, albeit familiar in the context of civil liability, although I do not see that there is a difficulty with transferring that into criminal law. The only problem that I foresee is that, where you might prosecute a company director, or someone from the company, on the common-law offence of culpable homicide alongside the company for the statutory offence of corporate homicide, the jury will have to approach deliberations from a different angle because the bases of the two offences are different. That is a difficulty, but it can be overcome by careful direction from the trial judge. I raise two matters. The first was addressed in detail by my noble friend Lord Brennan and concerns the justification for requiring that guilt is brought home only if organisation of activities by senior management is a substantial element in the breach. I question the necessity to find a responsibility by senior management. I am not yet persuaded that it is the proper approach. It adds a burden on the prosecution to demonstrate that senior management were to blame, and to identify who they are. The question also arises of whether an organisation will be able to escape prosecution or conviction if the decision-making affecting the risks faced by employees in their work is sufficiently devolved to a level below senior management. If so, or even if it is a perception, might there not be a temptation for organisations to structure themselves to avoid that possibility? That would create a paradox: the legislation that we hope will further protect workers might be a spur to putting them more at risk, as the decisions leading to risk would be taken by junior members of staff. Secondly, there is room for us to be more creative on penalties. Something like a corporate community service order is a suggestion that we might well look at. I would like to hear more about disqualification of directors, especially where the decision leading to a death can be traced back to them. Many will say that this legislation is overdue. Equally, while the Bill is small, some of its concepts are difficult and important. It is right that we should give it careful consideration.