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UK appeal court overturns 'manifestly excessive' health and safety fine

The Court of Appeal has reduced to £200,000 a "manifestly excessive" £475,000 fine imposed on a truck sale and leasing company for breaches of health and safety law which led to the accidental death of a contractor.16 Apr 2018

ATE Truck & Trailer Ltd pled guilty to failing to have a written risk assessment in place covering trailer dismantling by its employees. William Price was not an employee, but the company accepted that the lack of risk assessment had a "more than minimal, negligible or trivial" connection with the fatal accident.

His Honour Judge Berlin, sentencing the company at Wolverhampton Crown Court in April 2017, had arrived at the fine based on "high" culpability under the Sentencing Council's definitive guideline for the sentencing of health and safety offences, corporate manslaughter and food safety and hygiene offences. He also found that there was a "high" likelihood of harm.

On both points, the sentencing judge disagreed with the submissions of both the company and the Health and Safety Executive (HSE). Both parties had submitted that ATE's culpability was low; while ATE had submitted that there was low likelihood of harm and the HSE submitted that there was medium likelihood of harm.

Lord Justice Gross, giving the judgment of the Court of Appeal, agreed that the sentencing judge had "departed significantly from the agreement and views of the parties" as to culpability and likelihood of harm arising. Although the judge was entitled to disagree "as a matter of principle", there was "no or no sufficient justification" for the judge categorising the case as he did, he said.

The appeal court agreed with HSE that there was a medium likelihood of serious harm occurring in this case. Lord Justice Gross said that, although the work was "inherently hazardous", "the only criticism of the method adopted by ATE employees was the absence of a risk assessment".

"We are unable to agree with the judge that the facts warrant classification of this case as one of high likelihood," he said.

Price was a scrap metal dealer who, at the time of his death, was based in a dedicated area of ATE's premises and performed certain work under an arrangement with ATE. He provided his own equipment and his own forklift truck, and performed his work using his own method, unassisted by ATE staff.

After the accident, an HSE inspector concluded that Price's method of work had been unsafe. However, ATE had genuinely believed that it had no responsibility for his activities. The company had no expertise in his area of work, and had contracted it out to him from the late 1990s onwards.

The Sentencing Council's definitive sentencing guideline came into force on 1 February 2016. Under the guideline, courts must now first assess the seriousness of the offence based on the offender's culpability and the risk of harm occurring, rather than the actual harm caused. Fines are taken from a range depending on the size of the organisation, based on turnover or the equivalent.

In terms of turnover, ATE was a 'medium' organisation, albeit at the bottom end of the bracket. This gave the appeal court a starting point of £40,000 under the guideline, taking into account the low culpability and medium likelihood of harm. Price's death, which ATE's offence was "a more than minimal, negligible or trivial cause of", justified the appeal court moving up to harm category 1, so that the fine would "have a real economic impact, so bringing home the appropriate message to ATE", Lord Justice Gross said.

"This was a tragic case, but we are pleased that the Court of Appeal has agreed with the position taken by our client and agreed with the HSE that its culpability was low," said Sean Elson of Pinsent Masons, the law firm behind Out-Law.com, who advised ATE in the case.

"We had always considered that on the facts of this case, the fine originally imposed was manifestly excessive and that the original approach taken in trying to apply the definitive guideline for sentencing health and safety offences had been flawed. This case also has wider application for the way such cases are dealt with, in particular reinforcing that the courts should have careful regard for any agreed position between the parties as there had been in this case," he said.