Third company convicted of Corporate Manslaughter
A third company has been convicted of corporate manslaughter under the Corporate Manslaughter and Corporate Homicide Act 2007. Under this piece of legislation companies and organisations can be found guilty of corporate manslaughter as a result of serious management failures resulting in a gross breach of a duty of care. Lion Steel Limited plead guilty to the charge at Manchester Crown Court in connection with the death of Steven Berry who sustained fatal injuries after falling through a fragile roof panel at the firm’s site in May 2008.
Since the legislation came into effect, Cotswold Geotechnical Holdings Ltd and JMW Farms Ltd have also been convicted, receiving fines of £385,000 and £187,500 respectively. Various discussions have also taken place about the fine being commensurate with the ability to pay with the Court of Appeal introducing the concept that, in some cases, putting a company out of business may be inevitable if they have committed a serious enough breach. In Cotswold’s case they entered voluntary liquidation shortly after judgement was laid down.
Sentencing guidelines published provide that fines for corporate manslaughter should rarely be less than £500,000. It has been argued that full application of the legislation is yet to be tested on a large corporate entity with complex management structures. The case of Lion Steel Limited will be of particular interest going forward as, of the three companies convicted to date, Lion Steel is the largest. Sentencing is due to take place on 19 July 2012. It will be of interest to see what level of fine is imposed in relation to guidance and company size.
This article first appeared in Law-Now, CMS Cameron McKenna's free online information service, and has been reproduced with their permission. For more information about Law-Now, click here