Thu 30 Mar 2017

Company allowed to sue health and safety advisers to recover fine

The Court of Session has allowed a company to sue its external Health & Safety advisers in an attempt to recoup a £200,000 fine imposed on them following a breach of regulations which led to the death of their employee.

Background

Joseph Troup was killed whilst working as a tipper driver at Hatton Mill Quarry, owned by D Geddes (Contractors) Limited, in Angus in 2012.  Mr Troup was reversing his lorry to tip a load of materials into a feed hopper.  Whilst a bund (a stop block) at the edge of the raised area above the hopper prevented lorries from reversing over the edge, Mr Troup reversed his lorry over the bund into the hopper and was killed.

The Health & Safety Executive (HSE) investigated the accident and found the bund was ineffective due to (1) it being of insufficient height; and (2) a build-up of sand and gravel in front of it created a ramp the lorry could drive up.  Geddes subsequently pled guilty to a breach under the Quarries Regulations 1999 and was fined £200,000.

Court Action

Geddes subsequently raised an action against Neil Johnston Health & Safety Services Limited seeking to recover the £200,000 fine.  The defender, as Health & Safety Advisors, undertook regular inspections of the quarry and supplied inspection reports to the pursuer.  It was Geddes' position that had they been advised of the issue with the bund, they would have rectified it and the accident would not have happened.

However, it was Johnston's position that the accident occurred due to Geddes' negligence in failing to address the build-up of tip materials in front of the bund.  Separately, they argued that Geddes was not entitled to recover as damages a penalty imposed upon it for its own criminal act.

Is it possible to sue another party to recover a financial penalty?

Lord Tyre considered Johnston's argument that recovery of a loss consisting of a criminal penalty or the consequences of imposition of a criminal sanction is necessarily excluded from recovery as a person cannot profit from their own illegal act.  Johnston relied upon Lord Hoffman's speech in a case called Gray v Thames Trains Limited and argued "compensation was not recoverable for damage that flowed from loss of liberty, a fine or other punishment lawfully imposed as a consequence of one's own unlawful act…. to avoid inconsistency between the criminal and civil law".  It was their position that it would "undermine the intention of Parliament if a person with statutory responsibility could escape punishment by passing the buck to another".

However, Geddes argued "in policy terms, it was in the public interest that employers be obliged to act on expert health and safety advice: that was why the 1999 Regulations made it compulsory to employ such advisors".

Decision

Lord Tyre rejected Johnston's argument noting in his Opinion that there is no authority - in Scotland or England - for the proposition that recovery of a loss consisting of a criminal penalty or the consequences of imposition of a criminal sanction is necessarily excluded by the principle that a person cannot profit from their own illegal act.

In previous cases, he noted courts emphasised the need to avoid inconsistencies between civil and criminal law but, he went on to say "all of these observations were made in the context of a claimant who was, or was at least presumed to have been, aware of what he was doing when he committed the offence.  When one is considering the position of a person with no such awareness but who has nevertheless been punished for commission of an offence, it seems to me that a different balancing of policy considerations is required".

It is important to note that Lord Tyre did not order that the £200,000 should be reimbursed but rather the case was competently brought. The detail of the case still falls to be considered.

Summary

Whilst cases such as these are always dependent upon the specific facts and circumstances relating to the action, it is an interesting point which is being made.

Should this case proceed to a full hearing on the facts, in the absence of previous case law, it will be interesting to see the court's approach.  If the court allows Geddes to recover the fine in full, this would clearly be a concern for health and safety advisers.  Of course, it may be that the court would analyse the specific facts of the case and decide upon an apportionment of blame and split the fine accordingly.

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