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Health & Safety, Scientific, Engineering and Technical Legal Specialists Larchfield House, Dundrum Road, Dublin 14.

info@shayflemingsolicitors.ie Tel:-01-2980685

Health & Safety Case Law Update

16th November 2017 Royal Marine Hotel, Dún Laoghaire, County Dublin

Shay Fleming BSc(AppSces)(Hons), BL, MA, MSc, DipSHWW(Hons), Member Institute of Physics, Chartered Physicist; Member Royal Society of Chemistry, Chartered Chemist; Accredited Mediator

Principal Solicitor

DPP v Kilsaran Concrete ULC Trim Circuit Criminal Court, 10th November 2017

[Source: HSA website]

• Kilsaran Concrete ULC fined €125,000.

• The company had pleaded guilty to a breach of the Safety, Health and Welfare at Work Act 2005.

• Mr. Thomas Moran, an employee, had four fingers amputated while cleaning the dosing section of a machine involved in the manufacturing of concrete products.

• The HSA found that there was no safe system of work in place for the cleaning of the machine involved in the accident.

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DPP v Aer Lingus Dublin Circuit Criminal Court, 20th March 2017

• Aer Lingus Limited fined €250,000 having pleaded guilty to an offence under Section 12 of the Safety, Health and Welfare at Work Act 2005, contrary to Section 77(2).

• The case arose as the result of an accident at an Aer Lingus cargo warehouse at Dublin Airport on the 5th November 2014.

• Mr John Murray, a driver from Skerries, who was employed by another logistics company, was collecting packages at the warehouse on the night of November 5th when he fell from a loading bay and tragically suffered serious head injuries from which he passed away some days later.

• The company (Aer Lingus Limited) pleaded guilty to failure to manage and conduct their undertaking in such a way that individuals at the place of work, who were not their employees, were not exposed to risks to their safety, health or welfare. In particular, they failed to apply their own written procedure for drivers, which should have meant that all drivers accessed the warehouse by a pedestrian stairs and doorway adjacent to the loading bay.

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DPP – V – Vincent Ruane Construction Limited 14th July 2016 , Longford Circuit Criminal Court

• Company fined €250,000 having pleaded guilty to a breach of Regulation 44(d) of the Safety, Health and Welfare at Work (Construction) Regulations 2006.

• A serious incident occurred on the 29th January 2013 in the Connacht Gold (Aurivo) Co-Operative Society retail store located in Farneyhogan on the Athlone Road in Longford.

• Two persons Mr Patrick Gaffney and Mr Sean Mulleady lost their lives.

• Two other members of the public were seriously injured with a number of others present suffering minor injuries and trauma.

• The fatalities and injuries occurred as a result of a large portion (circa 104m2 equating to circa 1000 blocks or 25 tons) of an internal masonry block wall collapsing into the retail section of the store.

• Both men had been standing at the customer service counter when a high wind event occurred, entered into the building through an open roller door and exerted sufficient force on the block wall causing it to fall into the retail store.

• Both were very seriously injured and died later in hospital as consequences of being struck by the falling masonry.

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• The HSA investigation determined that the masonry wall had been built in January / February 2012 by Vincent Ruane Construction Ltd.

• A significant deviation from the original wall specification occurred, from plasterboard slabs to masonry blockwork.

• The masonry wall did not have any structural head or end restraints installed into the wall to effectively tie the wall to the structural portal frame, thereby giving it stability.

• As a consequence of this failure a block wall of area 104m2 equating to circa 1000 concrete blocks weighing approx. 25 tons collapsed into the retail store of Connacht Gold.

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DPP – V – VF Cold Stores Limited Dublin Circuit Court , 6th May 2016

• Company fined €200,000 having pleaded guilty to two charges under the Safety, Health & Welfare at Work Act 2005.

• The case arose as the result of a fatal accident on 28th November 2013 at the company’s premises in Finglas, Co. Dublin.

• Mr Robert Ceremuga, a warehouse supervisor employed by V F Cold Stores Ltd, died when loaded racking in one of the warehouses collapsed and fell on him.

• An investigation by the Health and Safety Authority concluded that a number of safety and health procedures were not fully implemented on the day of the accident.

• V F Cold Stores Ltd pleaded guilty to Section 8(2)(a) of the 2005 Act contrary to Section 77(9)(a) in that their employee Robert Ceremuga suffered personal injury and died.

• The company also pleaded guilty to Section 8(2)(g) of the 2005 Act contrary to Section 77(2)(a).

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DPP – V – Olema Consultants Dublin District Court, 9th March 2016

• The company were found guilty on six charges and fines totalling €18,000 were imposed on Olema Consultants Ltd.

• The case arose following an investigation by the HSA into an accident where an employee of Olema Consultants Ltd working on the construction site, fell from a height when he was erecting scaffolding.

• The accident happened on 6 May 2014 at the rear of the Harcourt Hotel.

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Increased Penalties Analysed

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DPP v Kilsaran Concrete Limited Trim Circuit Criminal Court, 18th February 2016

• Kilsaran Concrete Limited is a limited liability company engaged in the business of manufacturing concrete products such as building blocks and paving stones. It operated a quarry and manufacturing facility, and employed approximately 400 people at the time.

• The company had purchased a fully automated “wet cast production line” for the manufacture of pre-cast and standardised concrete products about 16 months prior to the accident.

• The machine used standardised moulds.

• The process started with an empty mould. While moving along a conveyor the mould was filled with liquid concrete and then levelled off. It was then put onto a drying rack until the product hardened. It was later retrieved from the drying rack. A suction device removed the dried product from the mould. The finished concrete product was removed. The empty mould was then lifted by a mechanical arm and moved on to an adjacent vibrating table where any dried concrete remnants were shaken from the mould in a cleaning process. The cleaned mould was then removed and ultimately returned by the conveyor to the filling line, where the process started all over again.

• When this machine was used for the purpose for which it was designed, manual intervention was not necessary at any point in the manufacturing process and the process was controlled externally by an operative using a control panel. A second individual carried out a visual examination of the finished product.

• The wet cast production line was enclosed within a safety cage to prevent access to the unguarded moving parts, and access to the caged area was controlled by a safety gate, the opening of which cut off power to the machine.

• A decision was made to use the wet-cast production line in an unorthodox manner to make bespoke products, ie. so-called Ballymun and Limerick kerbs, which were too big to be produced with the machine in automatic mode and which required the use of custom made wooden moulds, which could not be shaken or automatically cleaned.

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• The use of the wet cast production line for the manufacture of “Ballymun kerbs” or “Limerick kerbs” was developed over a number of distinct phases.

• They were initially manufactured entirely by hand, using a custom made mould filled by bucket with wet concrete.

• Due to the labour intensive and slow nature of this process, it was decided to use the wet cast production line in the manufacturing process as follows:

a) The door of the safety cage would be opened and left open.

b) The moulds would be individually brought into the safety cage and placed on the conveyor belt immediately before the dosing station.

c) The operative would leave the safety cage, closing the door behind him. The mould would be filled and taken to the drying area.

d) The process was repeated and continued to completion.

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• The following day the process would be reversed as follows: a) The mould is delivered from the drying area. b) Two operatives would enter, leaving the safety door open and manually remove and disassemble the mould. c) The two operatives would exit, with the disassembled mould, closing the door behind them. d) The process would re-start. • In May/June of 2011, the company received a large order for Ballymun kerbs, and at

some point a decision was made to leave the operatives inside the safety cage during the de-moulding process, with the broken down moulds being passed over the safety cage for reassembly. While this lead to an improvement in production speed, it remained slow as the moulds were being reassembled outside and therefore could not be fed back into the production line on a constant basis.

• To address this shortcoming a decision was made to reassemble the moulds inside the safety cage. As there were no workstations inside the safety cage, the cleaning or vibrating table was used to re-assemble the mould, as it was the only flat surface available. In the normal way, a mechanical arm placed moulds onto the vibrating table for cleaning on a continuous basis and consequently this had to be overridden and shut off to allow the vibrating table to be used to re-assemble the moulds.

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• As the wet cast production line was only used to make Ballymun kerbs in the morning and had to be left in automatic mode at the end of the shift in the evening to complete the cleaning cycle, the operator at the control panel was required to disable the cleaning arm before commencing work in the morning.

• On the morning of the 6th of September 2011, the operator at the control panel forgot to disable the cleaning arm. The deceased, Mr. Barry Gargan, and a colleague entered the safety cage as normal and when the deceased commenced reassembling the mould on the vibrating table, the cleaning arm descended, crushing him and killing him instantly.

• A statement from Mr.. Phelim Tierney, a student who had been working at the plant over the summer, told the court that he had earlier been involved in a “near miss” incident involving the same procedure, in which he was almost killed.

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• Mr. Bagnall, the most experienced operative at the plant, said in a statement which was read to the Court that he had previously expressed concerns over the safety of this particular procedure, stating:

“The old process of manually pouring kerbs was deemed too slow. Carl asked my opinion about using the wet cast plant to manufacture the kerbs but I told him, ‘It's nothing to do with me. You're the boss.’ When Carl explained the proposed procedure to me, which included having two men inside the safety zone to de mould the kerb, I told him I wasn't happy with this as it was not the safest way of doing it.” • The “Carl” referred to was Mr. Carl Griffin, a production engineer employed by the

respondent at the time, and the person within the respondent’s company who had instigated the unorthodox procedure just described. Mr. Bagnall indicated that notwithstanding the concerns that he had raised with Mr. Griffin concerning the safety of the proposed procedure, Mr. Griffin insisted that that procedure should nonetheless be used.

• Mr. Griffin was co-accused with the respondent company. He also pleaded guilty and received a fine of €10,000. The applicant has not sought a review of that sentence.

• The court was told that the Health and Safety Authority (HSA) accepted that the nature of the respondent’s business, and particularly quarrying, was comparatively high risk. Despite this the respondent was considered by the HSA to have a relatively good safety record.

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• Mr. Griffin was co-accused with the respondent company. He also pleaded guilty and received a fine of €10,000. The applicant has not sought a review of that sentence.

• The respondent has one previous conviction recorded in 2006 for an offence under the Safety, Health and Welfare at Work Act 2005 arising out of a serious accident in a quarry operated by it, where an operator fell off a working platform resulting in the operator receiving serious injuries. The respondent was fined €100,000.

• The sentencing court was provided with certain financial information concerning the respondent company. While some of this information may be commercially sensitive, and for that reason will not be specifically alluded to save to the extent necessary, it can be stated that the respondent is a substantial entity with very significant assets and turnover. While in common with other businesses involved with the construction industry it had seen a significant downturn in its business for a number of years from 2008, resulting in trading losses in that year and for a number of years thereafter, by the date of sentencing it was well on the road to recovering the ground lost and indeed had achieved a breakeven trading situation, with a forecast for an early return to trading profits.

• The evidence before the sentencing court was that the respondent had been co-operative with the HSA’s investigation into the accident, admitting that it was in the wrong and accepting blame for the tragedy. The plea had been entered at the earliest opportunity. The company had apologised to the Gargan family, and its directors had expressed remorse for what had occurred. It was acknowledged that the late Mr. Gargan had been an excellent employee.

• The sentencing court also heard evidence that a fatal injury claim had been brought against the respondent on behalf of the relatives and dependents of Mr. Gargan, and that this had been settled and the settlement amount paid promptly by the respondent in circumstances where, by reason of a substantial insurance policy excess, the respondent was effectively self insured.

• A number of other employees who witnessed the accident suffered nervous shock, and sought compensation from the company on that account. These claims were also settled and paid promptly in similar circumstances.

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Aggravating Factors

• Serious offence;

• Fatal injury;

• Employee was permitted to enter and work inside the guarded area where the wet cast production was operational and where the lift arm was operated automatically and sensor controlled;

• Employee exposed to a high risk of injury and resulted in death;

• Deceased had a partner and young son

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Mitigating factors

• The Kilsaran Concrete Limited and Mr. Griffin pleaded guilty, avoiding an extraordinarily long trial;

• Guilty please had been entered early and saved the family great trauma and distress;

• Both accused had fully co operated with the investigation and that this was extremely helpful.

• No impediment or obstructions put in respect of any evidence.

• Court satisfied that there was a genuine expression of remorse by the company.

• The company had an effective policy of insurance in place with a substantial excess making it effectively self-insured.

• Company had a good record except for an earlier conviction in 2006.

• Civil matter had been settled.

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Court of Appeal – 6th April 2017

• Matter appealed by the DPP.

• Circuit Criminal Court Penalty deemed to be too lenient.

• Earlier Irish and UK case law referred to.

• UK case law may be persuasive.

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Court of Appeal’s Analysis and Decision

Four issues considered: -

i) the assessment of the gravity of the case;

ii) the allowance made for mitigation;

iii) proportionality in the overall sentencing process; and

iv) sentencing policy issues.

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The Gravity of the case

• Must have regard to the culpability of the offender and the harm done.

• Noted that Kilsaran Concrete Limited’s culpability was very high.

• Considered that there was a deliberate breach of the law to maximise profits.

• Considered that there was a conscious and deliberate discounting of safety concerns raised by an experienced employee.

• A previous near-miss was disregarded and ignored.

• The practices which culminated in the accident were adopted incrementally over a period in excess of a year and created a very high level of risk and significant danger. 19

• It wasn’t a case of passive neglect or omission giving rise to a one off incident or a momentary lapse of attention.

• There was a wilful neglect of the duty to ensure, as far as practicable, the safety of the company’s employees and a calculated decision to take unjustified risks.

• The impugned practices were not merely condoned, they were actively encouraged and required the participation of a member of senior management.

• Issues regarding a safety culture.

• The sentencing judge failed to adequately reflect the gravity of the offending conduct in his sentence, and that was an error of principle.

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The Allowance made for Mitigation

• Payments of compensation are not to be treated as mitigation though some account may be taken if there is evidence that they will give rise to particular hardship for the offender.

• Compensation is not wholly black or white.

• Legal liability to pay compensation on foot of a civil claim for breach of statutory duty.

• Payment of financial restitution can be evidence of genuine remorse.

• Payment of compensation by a man of straw who has borrowed may be considered as mitigation as a plaintiff may not be able to execute a judgement against a defendant.

• The payments made did not impose significant hardship having regard to resources.

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• The decision to insure subject to an excess was a commercial decision for which it received benefits including having to pay a lower premium.

• The existence of a policy excess is irrelevant.

• Allowance made for the payment of compensation was an error in principle on the part of the sentencing judge.

• The sentencing judge was correct in making allowance for the guilty plea, the offender’s co-operation, remorse, remedial steps taken, and the company’s reasonably good safety record.

• The sentencing judge didn’t appear to have regarded the previous conviction which occurred some years previously and related to a completely different aspect of the respondent’s business.

• The Court was unable to ascertain the exact discount afforded by the sentencing judge but anything greater than 50% would be regarded as generous.

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Proportionality

• The Safety, Health and Welfare at Work Act 2005 makes the failure to comply with almost any obligation created in that regard a criminal offence.

• The one penalty section, Section 78 provides for all potential offences whether they involve venial or mortal sins.

• The Court suggested that that experience and precedent indicates that cases involving moderate culpability and resulting in moderate harm would rarely attract a fine in excess of a six figure sum today, with the result that the first one third of the available range may represent the realistic spectrum of fines that is in fact applied in such cases.

• The actual available range is not reflective of their actual gravity.

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• Even in the case of offences such as the present involving a highly culpable failure to maintain or enforce safety standards, and resulting in serious harm, the requirement to impose a proportionate sentence may in some cases militate against benchmarking gravity with reference to the full range of potential fines, and again in that situation a court would be justified in approaching the task with reference to a lesser more realistic range taking into account the offender’s resources and ability to pay.

• In this case while the sentencing judge noted that the available range involved a fine of up to a maximum of €3,000,000, and expressed the view that the case fell to be located in the middle range, he also stated that “one must be realistic in respect of fines in that category” which suggests that he intending adjudging the case with reference to what he considered to be the realistic range rather than with respect to the full range. We have already indicated that in certain cases that may be an appropriate approach. It begs the question: was it the appropriate approach in the circumstances of this case?

• A major problem with the sentencing judge’s approach is that he gives no indication in his judgment as to what he considers the realistic range to be, or as to the criteria by means of which he has determined upon that range.

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• The sentencing court was provided with some financial information which it was entitled to have regard to.

• As of the date of sentencing, the company was experiencing a recovery, and a break-even trading situation had been achieved in 2015 with the forecast of a return to profitability in 2016.

• The Court noted that the company’s current turnover was very substantial (in the nine digit range) and despite the disposal of some assets it retains a very strong balance sheet comprising assets valued at many millions of euro.

• The sentencing judge fell into error in disregarding the full available range of fines in favour of an unspecified, but manifestly lesser, range of fines that he considered to be realistic.

• The circumstances in this case were deemed to be truly egregious and the company had adequate resources and ability to meet any fine imposed.

• A very substantial fine would be in the interests of meaningful deterrence. • There was no evidence that a very substantial fine would threaten the viability of the

company or precipitate its dissolution.

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Sentencing Policy Issues

• In The People (Director of Public Prosecutions) v. Cavan County Council and Oxigen Environmental Limited we stated:

“In the case of a corporate offender, while there is no constitutional requirement of proportionality in terms of interference with personal rights and personal liberty, sentencing must nevertheless be fair to the corporate offender and be in accordance with the constitutional guarantee of due process. Accordingly, the process of sentencing a corporate offender must still take account of the gravity of the offence, including the culpability of the offender, and relevant circumstances of the entity concerned should be taken into account in mitigation. A sentencing court must still have regard to the sentencing objectives of retribution, deterrence (both specific and general), and rehabilitation but there will frequently be more emphasis on deterrence than on the other objectives”

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• The law breached in this case was designed to protect and promote public welfare and particularly the welfare of employees in their place of work.

• The respondent’s reckless disregard for safety in the pursuit of profit drove a coach and four through the policy of the legislature, and requires to be punished and future conduct of that sort requires to be deterred.

• The ultimate sentence was one of €125,000 and it was entirely inadequate in the circumstances of this case to communicate the appropriate messages.

• Even assuming a generous but appropriate discount of 50% for mitigation, that would have meant the sentencing judge’s starting point was €250,000 which was simply too low by far, both in terms of adequately punishing the offence, but also and more importantly in terms of deterring the respondent, and others, from engaging in similar breaches and disregarding safety requirements in the future.

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Court of Appeal’s conclusions and re-sentencing • Satisfied that the Circuit Criminal Court’s sentence was unduly

lenient.

• It was a clear departure from the norm.

• It was caused by several errors of principle.

• Circuit Criminal Court’s sentence quashed.

• Having regard to Kilsaran Concrete Limited’s very significant culpability and the substantial harm done, the gravity of the case merited a headline sentence involving a fine of €2,000,000.

• Allowed a 50% discount for the mitigating factors in the case.

• Final sentence of €1,000,000

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Costs

Section 78(4) of the Safety, Health and Welfare at Work Act 2005 provides:-

• “Where a person is convicted of an offence under the relevant statutory provisions in proceedings brought by the Authority or a prescribed person under section 33 , the court shall, unless it is satisfied that there are special and substantial reasons for not so doing, order the person to pay to the Authority or the prescribed person under section 33 the costs and expenses measured by the court, incurred by the Authority or the prescribed person under section 33 in relation to the investigation, detection and prosecution of the offence including costs and expenses incurred in the taking of samples, the carrying out of tests, examinations and analyses and in respect of the remuneration and other expenses of employees of or consultants and advisers engaged by the Authority or the prescribed person under section 33 , as the case may be.”

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People (DPP) – Roadteam Logistic Solutions (formerly known as Nolan Transport (Oaklands) Limited)

Court of Appeal, 18th February 2016

• Roadteam Logistic Solitions, a major road haulage company, was both the owner and operator of a lorry and trailer which was transporting six steel coils weighing 25 tons.

• The lorry had been loaded with this freight in Wales, and the coils were placed on crates, but they were inadequately secured.

• The lorry with its load travelled to Rosslare Harbour, where it arrived on the evening of the 18th July, 2007. From there it travelled to New Ross, where it remained overnight at the appellant’s transport yard. The following day it resumed its journey to Athy in Co. Kildare.

• As the lorry was approaching a bend in the road near Thomsatown, Co. Kilkenny, the lorry itself and the trailer began to lean to the wrong side of the road.

• The straps that were used to secure the metal coils started to break and fly across the road, and the six steel coils then began to slide off the trailer resulting in the drivers of two motor cars travelling in the opposite direction being killed.

• The deceased persons were Mary Lonergan and Vanessa McGarry. Injuries were caused to four other people.

• A detailed investigation of the collision, and the events proceedings it, showed that the freight being carried had not been properly secured.

• This failure resulted in the coils breaking free as the lorry was approaching the bend in the road at some speed.

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• Roadteam Logistic Solutions is a major Irish road haulage company employing over 500 people at the time of the sentence hearing and having a fleet in excess of 300 vehicles at that time.

• It had no previous convictions for health and safety offences.

• Since the accident, it was noted that the company had spent a considerable amount of money improving its health and safety standards, and that it had also built a training facility on its premises in Co. Wexford for the purpose of delivering training to its employees on health and safety matters.

• The ability to pay a substantial fine such as the one imposed was not an issue before the Court of Appeal.

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• Roadteam Logitic Solutions was charged with several offences arising from this accident and eventually pleaded guilty to one count on the indictment, namely, Count No. 14, which alleged an offence contrary to ss. 12 and 77(9) of the Health and Welfare at Work Act 2005.

• The particulars of the offence stated that the appellant had failed to mange and conduct its undertaking so as to ensure as far as practicable that persons other than employees were not exposed to risks to their safety, health or welfare, in that a load being carried by an articulated lorry and trailer was not adequately secured thereby causing the deaths and injuries which have already been referred to.

• The company was fined €1,000,000

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• The company appealed that the fine of €1 million was excessive, as:- • It was the company’s first ever health and safety conviction. • There was a plea of guilty. • The offence involved a single incident. • The mens rea of the count to which the company pleaded guilty was one of

reasonable care. • It was contended that the trial judge appeared to have sentenced the defendant on

foot of a count not actually before the court, namely, one based on gross negligence which was not the subject of any conviction.

• It was also contended that the learned sentencing judge ought not to have characterised the offence as being on a level with the worst that had come before the Circuit Court, arguing that it was difficult to see how an offence based on reasonable care which arose out of a single incident in which a driver did not ensure that his load was properly secured could fairly be placed in the category of the worst to have come before the court.

• Various reports from the HSA’s Annual Reports from 2013 – 2014 were relied on relating to outcomes of prosecutions and fines imposed.

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• In support of its contention that the fine was excessive, counsel for the appellant relied on R. v. Balfour BC Rail Infrastructure Services Limited[2007] 1 Crim.R.(S) 65, in which the Court of Appeal in the United Kingdom noted a distinction between cases involving a systemic failure and those where an individual was primarily at fault for the failure.

• The Company argued that in circumstances where a breach of health and safety matters is attributable to the negligence of an individual, rather than to management, a deterrent sentence on the company is not appropriate.

• In support of this submission, counsel for the appellant maintained that the accident had been caused in part by the driver of the vehicle driving at excessive speed.

• The Company referred to the overspill factor and saying that knowledge that breach of a duty can result in a fine of a sufficient size to impact on shareholders will provide a powerful incentive for management to comply with a duty.

• This is not to say that the fine must always be large enough to affect dividends or share price. But the fine must reflect both the degree of fault and the consequences so as to raise appropriate concern on the part of shareholders at what has occurred.

• Such an approach will satisfy the requirement that the sentence should act as a deterrent. It will also satisfy the requirement, which will rightly be reflected by public opinion, that a company should be punished for culpable failure to pay due regard to health and safety, and for the consequences of that failure.

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Court of Appeal’s conclusions • The cases referred to in HSA’s 2013 and 2014 Annual Reports were of limited assistance

given that significant details of each of theses cases are not contained in the reports.

• The responsibility for the secure strapping of the load lay firmly with the company as both the owner of the vehicle and employer of the driver.

• The omissions were of a high order and all the more serious because they related to a core activity of the appellant’s business.

• Not persuaded by the submission to the effect that the appellant was not given sufficient credit for the fact that its culpability consisted of omissions rather than a deliberate act.

• The sentencing judge was entitled to conclude that the omissions by the appellant amounted to a gross dereliction of the defendant’s statutory duty to road users under s. 12 of the Act of 2005.

• It had been accepted by the Company’s Counsel that the standards in place at the time of the accident were grossly inadequate.

• The sentencing judge had considered that the Company had expended considerable funds on health and safety matters since the accident and put systems in place to ensure best practice would be complied with.

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• Conscious of the possible adverse consequences for innocent employees of the appellant company by it having to pay a fine of €1 million in one go, he directed that the fine be paid over a three year period thereby having proper regard to the “the overspill factor”.

• The sentencing judge did not impose sentence immediately following the sentence hearing, in the course of which he had heard victim impact reports which must have been harrowing.

• We conclude therefore by holding that while the fine imposed was a significant one for the appellant company, it was a fine that was just and proportionate given the nature of the omissions and the harm caused. Accordingly, the appeal is dismissed.

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The People (DPP) – V - Cavan County Council and Oxigen Environmental Limited

Court of Appeal, 24th June 2015

• Both defendants pleaded guilty on the 30th November 2012 at Cavan Circuit Criminal Court, to one count of

having disposed of waste other than in accordance with a term of the waste license that had been granted by the Environmental Protection Agency, contrary to section 39 (1) and 39 (9) of the Waste Management Act 1996.

• The offences related to the disposal of waste at a landfill in Corranure and Lismagratty Townlands, Cootehill Road, Cavan, between the 14th of February 2007 and the 30th of September 2007, in respect of the first named appellant, and between 1st of October 2007 and 14th of February 2009, in respect of the second named appellant. During both periods, Cavan County Council was the licensee of the landfill site.

• It was itself in occupation and control of same up to, but not including, between 1st of October 2007 and 14th February 2009, during which time Oxigen Environmental Limited was contracted to manage and operate the site.

• Cavan County Council had two previous convictions for environmental offences.

• Oxigen Environmental Limited had no previous convictions.

• At sentencing, Cavan County Council received a fine of €260,000. Oxigen Environmental Limited received a fine of €780,000.

• The appellants appealed against the severity of these fines.

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Background • Cavan County Council had been issued a waste license by the Environmental

Protection Agency. • Condition 7.1 thereof imposed a duty on the Council to ensure that odours

emanating from the landfill did not give rise to a nuisance at the facility or in its immediate vicinity.

• However, inspections of the site undertaken by the Environmental Protection Agency on 30th of May 2007, 11th of July 2007, 4th of November 2008 and 11th of November 2008, detected the presence of noxious odours which were being emitted primarily as a result of waste deposited into engineered cells but also as a result of malodorous landfill gases which this waste generated. Notices of non-compliance were issued to the appellant following these inspections.

• The odours, which were described as moderate, strong and persistent, caused significant interference with the amenities of landowners and residents beyond the boundaries of the licensed facility, up to and including 2km from the site.

• The landfill is located within a 1.6km radius of approximately 100 residences. There are also two secondary schools, housing developments and a residential nursing home within a short distance.

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• Cavan County Council had made a substantial investment in the Corranure site and that, notwithstanding the breach at issue, the site was now being operated in full compliance with the waste licence.

• Oxigen Environmental Limited had been employed as a specialist contractor Cavan County Council to take over the day to day operation of the facility.

• Cavan County Council remained involved insofar as possible and liaised with the Environmental Protection Agency despite its limited control of the site at that time.

• In interviews with employees of the Council, the Environmental Protection Agency (EPA)had been informed that there had been no financial restrictions limiting the actions which the Council was willing to, or needed to, undertake to remedy the issue of the malodorous emissions.

• At the time of sentencing, Cavan County Council was operating the Corranure landfill in accordance with best practice and that the risk of malodorous emissions was being effectively controlled.

• Oxigen Environmental Limited had fully engaged with the EPA’s inspectors, and the agency had no outstanding issues with that company.

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Cavan County Council informed the Court:

• It had expended in the region of €19 million in capital expenditure on the site since 2001.

• In 2007 and 2008, the Council had earned €8,300,000 and €8,730,000, respectively, in waste disposal fees.

• The Council would be incurring costs of approximately €300,000 per annum to manage the site for the next 30 years. This was despite the Council’s budget being substantially reduced due to the economic downturn. The Court heard the maintenance figure for 2012 (the year in which the sentencing hearing took place) was in fact €396,000.

• The Council had expended approximately €19,000,000 since 2001 to bring the facility up to the appropriate standard and outlined that and the fact that the facility, from 2010, was neither receiving waste any longer, nor was it, accordingly, receiving income.

Also, the Court had not received any evidence of profit / loss.

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• At the original sentencing hearing both defendants had relied on their guilty pleas, entered at an early stage, as mitigating factors and the fact that it was neither argued by the prosecution, nor was it suggested at any stage, that the appellants had economically benefited from the breach of the waste license.

• Cavan County Council had pleaded in mitigation that the circumstances in this case did not concern an individual engaged in inherently wrongful activity but related instead to a public body providing a public service, whose breach of a licence arose not as a result of specifically prohibited action or inaction, nor any other intentional, reckless or negligent act, but instead as a result of a failure to keep pace with technical and regulatory change.

• Also, the Corranure landfill was a difficult site to manage and one which was going to require constant monitoring and control as it has been anticipated that the landfill will continue to produce gases and to generate leachate for the next 20 to 25 years.

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• In addition, the sentencing judge should take into account the Council’s inability to make profit from the Corranure site and its public duty to operate the site against a backdrop of declining financial resources. The first named appellant submitted that the offence, being a nuisance rather than an offence causing significant environmental harm, should be more properly situated on the lower end of the spectrum of gravity for similar offences.

• Oxigen Environmental Limited adopted the submissions made on behalf of the first named appellant to the extent that those submissions were relevant to its case. It further relied on its admission of responsibility and the apology that it had offered.

• It was further submitted that Cavan County Council and Oxigen Environmental Limited had in fact benefitted financially from their breach in that the Corranure site was receiving 80,000 tons of waste a year during 2007 and 2008 when the offences occurred, and received over €800,000 in waste disposal fees in each of those years in respect of that waste.

• The maximum penalty which could have been imposed by the sentencing judge was a fine of up to €12,700,000. The judge chose to impose a fine of €10,000 for every week that the Cavan County Council and Oxigen Environmental Limited had managed and operated the site for the duration of the offences. Accordingly, the 26 week period within which Cavan County Council controlled the site resulted in a fine of €260,000 for the Council, whilst Oxigen Environmental Limited received a fine of €780,000 to reflect the 78 week period for which it was contracted to manage the site.

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Grounds of Appeal -

• Cavan County Council and Oxigen Environmental Limited submitted that the fines they received are unduly severe and ought to be set aside. Both appellants submitted broadly similar and overlapping grounds of appeal.

• The sentencing judge erred in principle in assessing the offence as a “very serious one”, and as warranting a “stiff” fine, thereby indicating that he was treating the case as one towards the upper end of the range of gravity for the particular offence, when the offence was more properly to be seen as one falling at the lower end of that range.

• The sentencing judge failed to locate the offences appropriately on the scale of gravity;

• The sentencing judge failed to apply the mitigating factors having first correctly located the offence on the scale of gravity;

• The sentence imposed would only have been appropriate had there been evidence that the appellants had profited from the offence;

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• The sentencing judge erred in principle in calculating the fines by reference to the cost of ongoing environmental maintenance, thereby punishing Cavan County Council for its continuing commitment to the maintenance of high environmental standards at the facility, a factor that should have been more properly treated as a mitigating factor;

• The sentencing judge erred in law in failing to distinguish between the appellants in calculating the fine for the second named appellant on the basis of money being spent by the first named appellant towards ongoing maintenance of the site;

• The sentencing judge erred in law in failing to consider that, in providing for a determinate albeit substantial fine, the Oireachtas had sought to limit the maximum fine that could be levied in a given case;

• The sentencing judge erred in principle in calculating the fines on the basis that it did not matter what level of fine was imposed and that he erred in law in calculating the fine in an arbitrary fashion;

• The sentencing judge erred in law in calculating the fine on a simple arithmetic basis and failing to have regard to the principle of proportionality;

• There was an error in principle in that the fines represent a substantial departure from previous sentencing precedents in like cases;

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Court of Appel’s Conclusions and Decision • The exercise of sentencing corporate offenders in environmental cases should in principle be similar

to the sentencing of private individuals in ordinary criminal cases, though relevant factors may receive different emphasis. Accordingly, the well established procedure of first locating the offence on the relevant scale in terms of its seriousness taking into account any aggravating circumstances and arriving at an appropriate sentence for the crime, and then factoring in any mitigating circumstances to reduce the sentence to one appropriate for the crime as committed by the particular offender should, in general, be followed.

• When a private individual is being sentenced there is an overriding constitutional requirement that a sentence should be proportionate, requiring the striking of a balance between the gravity of the offence in the particular circumstances in which it was committed and the relevant personal circumstances of the offender.

• In the case of a corporate offender, while there is no constitutional requirement of proportionality in terms of interference with personal rights and personal liberty, sentencing must nevertheless be fair to the corporate offender and be in accordance with the constitutional guarantee of due process.

• Accordingly, the process of sentencing a corporate offender must still take account of the gravity of the offence, including the culpability of the offender, and relevant circumstances of the entity concerned should be taken into account in mitigation. A sentencing court must still have regard to the sentencing objectives of retribution, deterrence (both specific and general), and rehabilitation but there will frequently be more emphasis on deterrence than on the other objectives.

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• Equally the court must be conscious of the spill over effects of a large fine that may unjustly punish persons not directly responsible for the offence such as shareholders, employees, creditors, customers, consumers, trading partners and, in the case of a public authority that might not be put out of business by a large fine in the same way that a commercial company might, but which might have to divert resources away from other public services being provided by it, the public at large.

• While a large fine that causes some spill over will not necessarily be wrong in principle, a court considering the imposition of such a fine is obliged to consider the potential spill over effects and satisfy itself that the proposed measure is none the less merited and proportionate, and a failure to do so would amount to an error in principle.

• The Court is satisfied that the sentencing judge erred in a number of material respects and that the appeals should be allowed.

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• The breach in the present case was passive and involved a sin of omission rather than commission.

• It was not the result of any deliberate act or determined delinquent conduct.

• Rather, it involved a breach of a broad result based condition, namely that the facility should not give rise to a nuisance either on the site or in the immediate vicinity of the site.

• The seriousness of the offence was properly rated as falling in the low to medium range on the scale of seriousness, in circumstances where no damage to the environment has been caused by the breach but by the same token a substantial number of persons were affected by the nuisance created, were inconvenienced and suffered transient prejudice to their amenities and the enjoyment of their properties.

• The offence was slightly aggravated by the appellants’ failure to respond as quickly as they ought to have done to the complaints communicated to them.

• It wasn’t fair to suggest that the appellants had profited from the breach and and while the facility was receiving waste at the material time, and was receiving waste disposal fees, there was no direct nexus between the breach and the generation of that income, nor was there any suggestion of increased income on account of the breach.

• The evidence did not go so far as to suggest that the nuisance was the direct result of the waste received during the period in question.

• The breach was due to structural issues giving rise to technical inadequacies in the management of landfill gases generated over time by the decomposition of waste that had been deposited into engineered cells.

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• Oxigen Environmental Limited had subcontracted to it the day to day management of the site.

• It was not responsible for addressing structural issues.

• It was outside of the remit of that company to make structural improvements to, or to upgrade, the facility, in circumstances where Cavan County Council remained involved as the primary licence holder, and Oxigen Environmental Limited was merely its agent responsible for day to day operations.

• The sentencing judge fell into error in imposing a far greater fine on the Oxigen Environmental Limited, than on Cavan County Council merely on the basis that Oxigen Environmental Limited was in charge of day to day operations on the site for a greater proportion of the relevant time.

• There was no legitimate basis for such discrimination having regard to the agency relationship between the parties.

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• It was a substantial mitigation factor that Cavan County Council invested very substantial funds in upgrading this facility, and also that it is saddled with a very substantial ongoing commitment in terms of maintenance of what is now a non-operating landfill site.

• The sentence penalised both appellants for the fact that Cavan County Council is committed on an ongoing basis to the spending of substantial monies on protecting the environment.

• The fact that the fine should have been linked to such expenditure was unfair and unjust in the case of both appellants, and was in addition quite arbitrary in the case of Oigen Environmental Limited.

• The fact that Oxigen Environmental Limited had contracted to act as the agent of a principal with such commitments in no way increases Oxigen Environmental Limited’s culpability.

• Cavan County Council was more culpable overall than Oxigen Environmental Limited.

• Cavan County Council was entitled to substantial increased mitigation on account of its historical capital expenditure aimed at upgrading the facility in the public interest and with a view to restoring it to a position where it could comply fully with the terms of its licence, and its ongoing current and future liabilities in terms of continued maintenance.

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• The sentencing judge fell into “the deterrence trap” in the circumstances of this case.

• The fines imposed were the highest ever imposed historically and were imposed without adequate regard to the ability of the appellants to pay, or to spill over effect.

• The fines imposed were also considerably out of kilter with such indirect comparators as were available, and were so by several orders of magnitude.

• It is difficult to quantify the discount actually given by the sentencing judge for mitigating factors such as the pleas of guilty, the parties’ co-operation with the EPA, their current good standing with the EPA, the remedial works and efforts undertaken, and the remorse and apologies expressed.

• The Court of Appeal was not satisfied that the sentencing judge gave sufficient allowance for mitigation in either case.

• The Court of Appeal substituted fines of €50,000 on Cavan County Council and Oxigen Environmental Limited for the original fines of €260,000 and €780,000.

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Health & Safety, Scientific, Engineering and Technical Legal Specialists Larchfield House, Dundrum Road, Dublin 14.

info@shayflemingsolicitors.ie Tel:-01-2980685

Thank you for your attention

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