Category: Law News

 

• New law makes prosecution of companies easier
• Significant improvement of some health & safety practices expected
• Makes the company culpable, rather than an individual within

 

What has changed?

A new law taking effect next year will make it easier to prosecute companies for corporate manslaughter. The move follows intense campaigning from trade unions and organisations, such as the Centre for Corporate Accountability, alarmed at the rising number of workers killed and the near insuperable difficulty of holding large organisations to account under the current law. In the year to April 2007 there was a 10% increase in workplace fatalities.

The Corporate Manslaughter and Corporate Homicide Bill received Royal Assent in July, and comes into force on 6^th April 2008. It provides for corporate liability – with an unlimited fine – if the gross negligence of a company, organisation or government body results in the death of an employee, consumer or other person affected.

The act breaks new ground in holding government bodies accountable – and its passage through Parliament was considerably delayed by debate as to whether deaths in custody should be included. Although the act will eventually apply to deaths of people: in prison, police custody, children’s secure accommodation, or detained under mental health legislation, this will come into force later.

 

What’s wrong with the present law?

Under existing common law, in order to establish corporate responsibility for manslaughter by gross negligence, the prosecution must identify an individual who represents the ’embodiment’ or ‘controlling mind’ of the company. It is not possible to add up the negligence of several individuals to show that the company is grossly negligent.

Identifying such an individual who is also personally guilty of manslaughter is virtually impossible in large organisations – hence the failure to convict after large – scale disasters such as the Southall, Paddington or Ladbroke Grove train crashes. The few successful prosecutions have involved small companies or partnerships where the director and the company were effectively indistinguishable.

 

What does it mean to the industry?

 

The new offence

The new act creates a statutory offence of corporate manslaughter (in England, Wales and Northern Ireland) or corporate homicide (in Scotland). A company will be liable if the way its activities are managed or organised by its senior management amount to a gross breach of the duty of care owed to employees, the public or other individuals, and those failings caused the person’s death.

According to Justice Minister Maria Eagle, the new act “will make it easier to prosecute companies who fail to protect people”. Describing the act as “a ground – breaking piece of legislation”, she said: “For too long it has been virtually impossible to prosecute large companies for management failures leading to deaths.” This legislation send out “a very powerful deterrent message to those organisations which do not take their health and safety responsibilities seriously”.

 

“Hollow victory”

However, while welcoming the act as a step towards improving health and safety standards, trade unions remain unhappy that it maintains the effective immunity of individual directors or managers of large companies. Alan Ritchie, general secretary for construction union UCATT, described the Bill’s passing as “a hollow victory” and believes that without the specific imposition of duties on directors, the construction industry – one of the most dangerous – will not become appreciably safer.

Although the existing common law can still be used if there is sufficient evidence against an individual running a small company, and managers can still be held accountable for breaches in health and safety legislation, UCATT and the TUC generally wanted legislation to provide for the possibility of imprisonment for negligent directors.

Under the new act, as with common law manslaughter, the prosecution will still have to prove that there was a duty of care owed to the deceased; that management failings amounted to a gross breach of this duty, and that this breach caused the death. Effectively this means that a company’s conduct must fall well below that which could reasonably be expected of it. However organisational health and safety failings resulting in a fatality can now lead to prosecution without the need to prove an individual guilty of gross negligence or manslaughter.

From April, the court will be thus able to address the collective failings of senior management in large organisations. Factors that will be taken into account in any prosecution include compliance with health and safety legislation, the seriousness of any failures to do so and the risk posed thereby. Any organisational attitudes, policies, systems or accepted practices likely to have encouraged, or tolerated, such failings will also be considered.

 

Health and safety practices highlighted

“All organisations need to have in place effective health and safety management systems, with safe systems of work and adequate training, instruction, supervision and monitoring, ” says Gary Lewis, senior solicitor in the Health and Safety Environment Group at Hammonds in Manchester, which is already offering seminars on the new act to its corporate clients. “Those that do have nothing to fear from the new legislation – but most companies are likely to feel nervous at the enactment of this new offence and now is a good time to re – visit the issue of check.”

It is also vital to investigate any past accidents or ‘near misses’, and learn the lessons, he says – rail companies, for example, got away with significant safety failings under the old law; they would be caught by the new one.

He also stresses that whereas the old common law was targeted at companies, the new act has a much wider application. It could well apply, for instance, to deaths stemming from outbreaks of MRSA in hospitals. If a hospital has already received warnings about its hygiene procedures, this is the equivalent situation to a near – miss in a factory – and the fact that the NHS is a non – profit – making organisation won’t help them.

 

Increased scope of penalties

As well as an unlimited fine, the court can impose remedial orders – requiring an organisation to take steps to remedy any management failings – and publicity orders – publicising the fact the company has been convicted of the offence – providing details, the amount of any fine imposed and the terms of any remedial order made.

The act can thus be expected to considerably concentrate employers’ minds on ensuring safe working practices. Elena Fry, a partner in the health and safety team at Biggart Baillie one of Scotland’s top legal practices, believes it likely that the prosecution authorities will make good use of the new law. “The penalties and knock – on effect on business that prosecution would bring must make health and safety a top priority for all organisations.”

Credit to this article to be given to Sheena Meredith a freelance medical journalist and contributor to Legal & Medical – the magazine for Personal Injury Specialists.

 

Related Resources

1. Lighting and Safety at Work
2. Should Accident Reporting Be Mandatory
3. Medical Accidents and Claims Procedure

+Richard Meggitt

ELLIS V BRISTOL CITY COUNCIL 2007

Regulation 12 of the Workplace (Health, Safety and Welfare) Regulations 1992; floor and traffic-route safety; transient hazards, contributory negligence

In Ellis The Court of Appeal has considered the standard required of employers in relation to the condition of floors and traffic routes under Regulation 12 of the Workplace (Health, Safety and Welfare) Regulations 1992 and has come to a decision that significantly favours claimants.

Mrs. Ellis worked as a part time care assistance at a home for the elderly and mentally infirm. The home was L-shaped and there was a smooth vinyl corridor running through it. One of the residents had the tendency to urinate in the corridor, often at the former of the L. Two non-slip maters were placed there as a result. Other residents were also incontinent and it was not uncommon for staff to find urine on the floor of the corridor or of a room. Mrs. Ellis injured herself when she slipped on some urine on the vinyl floor, having gone round the corner and over the non-slip mats. Before Mrs. Ellis’s accident, there had been various falls over the years because of urine on the floor and staff were recorded as having to mop up urine several times daily. A risk assessment carried out in the month before this particular accident led to the mats being placed at the corner of the corridor and further warnings being given to staff about the need to be careful.

The Claimant relied on Regulations 12 (1), which provides that:-

Every floor in a workplace and the surface of every traffic route in a workplace shall be of a construction such that the floor or surface of he traffic route is suitable fort the purpose for which it is used.

Her fallback case was Regulation 12(3):

So far as reasonable practicable, every floor in a workplace and the surface of every traffic route in a workplace shall be kept free from obstructions and from any particular or substance which may cause a person to slip, trip or fall.

A claimant is likely to prefer to rely upon Regulation 12(1) than to use Regulation 12(3) since the later obligation has a “reasonable practicability” defence and the former is a stricter standard: if the construction of the floor is not suitable for its purpose, then there is a breach of duty. In the end, she succeeded on Regulation 12(1) and so the Court of Appeal did not need to consider the fallback case.

Under Regulation 12(1), Mrs. Ellis said that a non-slip floor should have been installed: the vinyl flooring was unsuitable as it was slippery when wet and residents urinated upon it frequently. A report from the National Care Standards Commission prepared post-accident, but based on an inspection pre-accident, recommended the installation of a non-slip floor and this was later carried out. The defendant said that the fact that the floor was slippery when wet did not render it unsuitable for use. Urine on the floor was a transient problem. The presence of urine had no bearing on the suitability of construction of the floor. It was also argued that Regulation 12(1) was directed at construction and Regulation 12(3) at maintenance; transitory conditions should be considered under Regulation 12(3), not the stricter test of Regulation 12(1).

Smith LJ, giving the leading judgment, said that the trial judge had erred by failing to consider whether the floor was suitable for its use in the circumstances in which it was being used. She concluded that the Court had to consider suitability in context, including in circumstances that were temporary in nature so long as they arose ‘with a sufficient degree of frequency and regularity.’ Regulation 12(1) read together with Regulation 12(2), not only covered permanent slipperiness but also some temporary slipperiness, Smith LJ said that:-

If a smooth floor is frequently and regularly slippery, because of a substance which lied upon it, albeit only temporarily, the surface of the floor may properly be said to be unsuitable, if the slipperiness is such as to give rise to a risk to the health and safety of those employees using it.

In contract, Regulation 12(3) was there to cover transitory conditions that occurred less frequently and it would be a matter of judgment in each case whether the hazardous condition arose with sufficient frequency and regularity to make the floor unsuitable for use. In this case, in all the circumstances, the floor was not suitable as it was dangerous when wet, accidents had already occurred and further accidents, which could well be quite serious, were likely. The result of the judgment is that many claims that previously would only have been considered to fall under Regulation 12(34) will now need to be looked at under the stricter test of Regulation 12(1). There is the potential for considerable debate about whether any particular temporary condition has arisen with a sufficient degree of frequency and regularity to make it incumbent upon the employer to make the construction of the floor or traffic route more suitable. In each case, though, it will still be necessary to consider ‘suitability’ in the full context, including the degree of risk, the nature of the people exposed to the risk, the frequency of previous accidents and so forth. Not every flaw will render a floor unsuitable, as shown by the earlier Court of Appeal decision in Palmer v Marks & Spencer [2001] (where a very small weather strip on the floor by a door, which had never caused any problems before, was not regarded as posing a risk to the ordinary person’s health and safety) Perhaps the only crumb of comfort for the employer in Ellis was the apportionment of one-third contributory negligence, for her:

….lack of concentration on the risk to be expected at the former [which] went beyond mere inadvertence.

Defendants may well fear that this case is the start of a ‘slippery slope’ where trial judges will be increasingly open to finding that the transitory condition was sufficiently common to require changes to the construction of the floor or traffic route – an obligation more onerous than merely taking reasonable practicable steps to keep the floor free of spillages and substances.

Credit for this article is given to Tim Petts, a barrister. The article was reported in the Personal Injury Law Journal.

+Richard Meggitt

The 2007 Rehabilitation Code – Making a real difference to injured people

The Rehabilitation Code provides an approved framework for injury claims within which claimant representatives and compensators can work together. Whilst the Code is voluntary, the court Pre-action Protocol provides that its use should be considered for all types of personal injury claims. The objective is to ensure that injured people receive the rehabilitation treatment they need to restore quality of life and earning capacity as soon as possible and for as long as the parties believe it is appropriate.

The important features of the Code are:

• the claimant is put at the centre of the process

• the claimant’s lawyer and the compensator work on a collaborative basis to address the claimant’s needs, from first early notification of the claim and through early exchange of information

• the need for rehabilitation is addressed as a priority and sometimes before agreement on liability. Fixed time-frames support the Code’s framework

• rehabilitation needs are assessed by those who have the appropriate qualification, skills and experience

• the choice of rehabilitation assessor and provider should, wherever possible, be agreed by the claimant lawyer and the compensator

• initial rehabilitation assessments can be conducted by telephone or personal interview, according to case type and the resulting report should deal with matters specified in the Code

• the claimant is not obliged to undergo treatment or intervention that is considered unreasonable

• the compensator will pay for any agreed assessment of rehabilitation needs and must justify a refusal to follow any of the rehabilitation recommendations

• the initial rehabilitation assessment process is outside the litigation process

• where rehabilitation has been provided under the Code, the compensator will not seek to recoup its cost, if the claim later fails in whole or part

The new 2007 Code simplifies the original version, first published in 1999, at the same time as underlining the important principles. It has the support of all the important stakeholders in the claims process including the ABI, IUA, APIL, FOIL, MASS, the Civil Justice Council and major insurers.

This document is a summarised version. To read in full, go to www.iua.co.uk/rehabilitationcode

For enquiries, please email [email protected]

The Rehabilitation Code is endorsed by many organisations, including:

Association of British Insurers

Association of Personal Injury Lawyers

Bodily Injury Claims Management Association

Case Management Society of the UK

Forum of Insurance Lawyers

International Underwriting Association

Motor Accident Solicitors’ Society

Time Scales

 

Claimant Solicitor	Duty of every claimant solicitor to consider from the earliest practicable stage in consultation with the claimant/their family and if appropriate treating physicians the need for rehabilitation Give earliest possible notification to compensator of the claim and need for rehabilitation  Where the need for rehabilitation is identified by the compensator, the claimant solicitor shall consider this immediately with the claimant and/or the claimant’s family
Compensator	Shall equally consider and communicate at earliest practicable stage whether the claimant will benefit from rehabilitation Where the need for rehabilitation is notified to the compensator by the claimant solicitor, the compensator will respond within 21 days
Parties	Consider choice of assessor and object to any suggested assessor within 21 days of nomination
Immediate Needs Assessor	Assessment to occur within 14 days of referral letter Provide report simultaneously to parties
Compensator	Pay for report within 28 days of receipt Respond substantively to recommendations to claimant solicitor within 21 days of receipt of report

 

+Richard Meggitt

 

• Provides more than just financial help to a client
• Signs of recent improvement in its application between claimant and defendant teams
• Find out how to best implement rehabilitation alongside claims

 

What To Consider In Rehabilitation

Although the pre-action protocols are not without difficulties, over the past few years claimant and defendant representatives have become a lot better at working together to re-habilitate injured claimants, providing them with more than just financial help.  However, many lawyers and insurers are still suspicious of rehabilitation, with some not knowing what to expect from their appointed rehabilitation service providers. This article intends to show how best to use rehabilitation alongside the claims process.

Service standards

Unfortunately, there are no formal professional standards for case managers or rehabilitation providers (RPs) in the UK, although the Case Management Society of the UK intends to publish best practice standards for case managers early in 2005.  It is therefore important to look for the following when working with RPs.

Independence

It is important for the case manager or RP to be independent and not affiliated to an insurance company or solicitor.  Only then can all parties trust that the injured party is at the centre of the rehabilitation process.

Effective, regular and open communication

In the past, RP’s have been criticised for sending regular bills without providing an update on the programme, or an indication of how much longer it will run.  It is imperative that progress reports are sent every four to six weeks, to update all parties.  Following the initial assessment, a rehabilitation plan should be produced detailing the likely length, cost, and expectations from the programme so that all parties can agree to proceed.  Update reports can then be monitored against the plan.

A focus on returning to work and achieving outcomes

If enabling a claimant to return to work is the agreed rehabilitation goal, the rehabilitation plan needs to be vocationally based and tailored to the individuals anticipated job.

Treatment/training providers are vetted and monitored

One of the main duties of the case manager is to co-ordinate treatments.  If the services must be bought on a private basis, service providers should be vetted before instruction and monitored during the treatment to ensure they are working towards the agreed goals.

When should rehabilitation be considered?

Although many still believe that an expert must assess whether any treatments would help the claimant recover as fully as possible, generally this is not the case.  If the claimant fulfils any of the criteria listed in the box overleaf, rehabilitation could help.

Service brief

When appointing a medial expert, lawyers send detailed instructions to ensure that the expert provides the right information.  Instructing a case manager or RP should be no different.  However, some lawyers include lengthy discussions on liability, causation and a full medical history.  This is unnecessary:  a brief medical synopsis should suffice.  More attention should be paid to the expected service standards, such as the timeframe for reporting, the expectations from the report, and ensuring that goals and objectives are set and achieved.  It is also worth clarifying at the outset that you require an outcome report at the end of the rehabilitation process.

Non-medico-legal

All parties must view rehabilitation as treatment and not as part of the evidence for the Court.  I have seen RP’s include a statement at the end of the report that their duty is to the Court.  This is incorrect as they have not been instructed as expert witnesses to the court.  Although rehabilitation can run alongside the claim/litigation, it should be kept completely separate.  The ethos outlined I the rehabilitation code of practice is that the parties work together to enable the injured person to achieve an optimum recovery.

Some RP’s confuse the issue further by stating that they will not give evidence in court, although they understand that their report could be put before the court for consideration.  In my view this is contradictory.  The report forms part of the medial records for the claimant and, as detailed below, provides nothing more than clinical fact.

During rehabilitation, information about the claimant can sometimes come to light with might increase or decrease the value of the claim.  RP’s should not discuss such information – it should be viewed as part of the medical and treatment records.  Similarly, RP’s are sometimes asked to attend conferences with counsel, and sometimes attend.  I think this is improper – RP’s risk compromising their independence if they become involved in the claims process.

Their sole aim should be to focus on the claimant’s recovery.  There may be occasional circumstances when the RP could be asked to give evidence as a witness of fact, but it is hoped that this is rarely required and does not become the norm.

Can rehabilitation be used once court proceedings have started?

Many still believe that early intervention provides the only possible chance of success with rehabilitation.  It is true that early intervention produces optimum results, but successful outcomes can be achieved further down the line.  If rehabilitation is used when court proceedings have been issued, there is a possibility that the process could be complicated if the judge is not keen on using rehabilitation.  However, if a united front is demonstrated then this should not affect the success of rehabilitation.

Many also get confused about the role of rehabilitation once court proceedings have been issued and the court’s timetable is underway.  However, this should not make a great deal of difference.  Judges appear content to agree to stays in proceedings to allow rehabilitation to take effect.  Rather than complicate the issue, a simplistic view should always be taken.  Will the rehabilitation be able to produce a more definite and final prognosis?  Is there a chance that the claimant will regain some lost function or return to work?  Is the claimant still awaiting further medical treatment?

I think that much of the confusion arises when lawyers try to obtain further medico-legal condition and prognosis reports, care reports or update their schedules/counter-schedules of loss.  Is if not futile to update evidence when rehabilitation is likely to change the position?

The answer must be to apply to the court for a brief stay to allow rehabilitation to take place.  In some areas the court may be prepared to let you do this by consent order.  Some may ask what evidence should be used to assist the court in agreeing to the stay.  The rehabilitation reports should not be used in litigation if the rehabilitation code of practice has been followed – witness statements should be sufficient.  The witness statements should refer to the fact that there is an initial assessment indicating that rehabilitation will help the claimant in their recovery, that all parties have agreed to work together in this regard, and that the report cannot be disclosed under the code of practice.

The same applies for schedules of loss, as if the rehabilitation is successful the care claim, future loss of earnings and/or Smith V Manchester award could be different.

Psychological considerations

Many readers will have been in a situation where experts have been unable to reach agreement in the run-up to trial.  Perhaps one expert stated that the claimant’s function and prognosis was consistent with the injury sustained, and the other that the claimant should have had more function and recovery when looking at the pathology of the injury.  Such opinions are based solely on the medical impairment model.  If no one takes into account the psychological or social aspects, then there is likely to be little improvement.  Recent work by the Association of British Insurers and the International Underwriting Association on the psychology of personal injury and rehabilitation has been published and indicates clearly that by using bio-psychosocial approach disproportionate outcomes can be drastically reduced.

One such case I dealt with involved a spinal injury.  The joint expert occupational therapist appointed to the case mentioned in passing that the claimant should undergo further rehabilitation (having already had one failed attempt via the NHS).

The trial was set aside, and the claimant underwent in-patient treatment and made remarkable progress, regaining some independence.  This threatened to reduce the value of her claim, but she had more hope for the future and had regained a sense or purpose.

Although not all trials should be set aside in these circumstances, it is certainly something that should be considered.

Rehabilitation indemnities

Another tool which can be effective is to use a rehabilitation indemnity as an integral part of settlement. If a trial date is approaching and rehabilitation is identified as appropriate, yet it is not economic to set the trial date aside, then a settlement can be negotiated which makes provision for rehabilitation to be provided afterwards.  The terms of this indemnity can stipulate the duration, ceiling costs and commencement period and, if appropriate, the name of the RP.  The claimant then benefits from functional recovery and a potential return to work.  Costs need not increase, as the case is settled, and acting solicitors need not stay involved.

Conclusion

All parties can benefit from using rehabilitation in suitable cases.  The real “spirit” of rehabilitation is to keep the claimant at the centre of the process and focus on maximising their functional recovery and assisting their return to work where appropriate.

It is surely time to forget the notion that personal injury claims are solely about the injured party and their advisers seeking the highest level of damage possible.  We must all learn to work as a team to achieve the best outcome and settlement (including functional recovery) for the injured party.

This article gives only a few examples of the issues that can arise, either pre-action or mid-proceedings, but if the principles discussed here are used, hopefully fewer disagreements will surface and rehabilitation will become an integral part of the system following personal injury, as it is in countries such as Australia, New Zealand, South Africa and Sweden.

Procedural positions and processes create much debate when mixed with rehabilitation, and I would welcome any further discussion or information regarding your own experiences.

Related Resources

1. Breaking Bones
2. Definitions & Treatments of Pain
3. The Serious Injury Team at ASD

This article was written by Mr W Herbert a client development manager at Health & Case. ASD recommend and use messes TICCS, please see TICCS

+Richard Meggitt