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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Criminal Division) Decisions >> Balfour Beatty Rail Infrastructure Services Ltd, R. v [2006] EWCA Crim 1586 (05 July 2006) URL: https://www.bailii.org/ew/cases/EWCA/Crim/2006/1586.html Cite as: [2007] BusLR 77, [2007] 1 Cr App R (S) 65, [2007] Bus LR 77, [2007] ICR 354, [2006] EWCA Crim 1586 |
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COURT OF APPEAL (CRIMINAL DIVISION)
ON APPEAL FROM HIGH COURT (QUEEN'S BENCH DIVISION)
CENTRAL CRIMINAL COURT
MR JUSTICE MACKAY
[2005] EWHC 248 QB
Strand, London, WC2A 2LL |
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B e f o r e :
MR JUSTICE NELSON
and
MR JUSTICE SILBER
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R |
Prosecution |
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- and - |
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Balfour Beatty Rail Infrastructure Services Ltd |
Appellant |
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Smith Bernal WordWave Limited
190 Fleet Street, London EC4A 2AG
Tel No: 020 7421 4040 Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
J Caplan QC & G Forlin (who did not appear in the Court below), & F Canby & T Sharpe for the Appellant
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Crown Copyright ©
Lord Phillips CJ:
The facts in outline
The course of the trial
i) The deaths were an aggravating feature of the offence.
ii) Balfour Beatty's faults were only some of an aggregation of causes that led to the derailment.
iii) Balfour Beatty failed to ensure that visual inspections of the track were carried out from the appropriate vantage point.
iv) Balfour Beatty failed to respond appropriately to information in reports of ultrasonic inspections.
"6. For the avoidance of doubt the plea above is made on the basis that:
i. there was no failure to comply with Railtrack mandated standards; and that no guidance was made available to maintenance contractors as to when rail affected by GCC should be removed or subject to speed restriction by reference to its measurement on visual inspection, albeit such guidance was made available after the derailment; and
ii. there was not in place an adequate grinding regime for the management of GCC; and that if re-railing had taken place as planned there would have been no derailment; that re-railing had been scheduled as a priority; and that parties other than BBRISL were wholly responsible for the carrying out of scheduled re-railing and for the failure to re-rail by the date of the derailment. "
The facts in more detail
"In January 1999, November 1999 (on two occasions), April 2000, June 2000 and finally on 6 October 2000, 11 days before the crash, such inspections were made of the crash site. On all these occasions the URFDO noted the presence of GCC, the seriousness of which was progressively deteriorating and that it was causing loss of rail bottom, or LORB, a description for the inability of the ultrasonic machine to obtain any reading due to the deformation of the rail by GCC and its obstruction of the ultrasonic probe. This condition persisted over hundreds of yards.
By the 2 November 1999 visits, the relevant URFDO, Fuller, was so concerned by what he saw that he phoned Alan Wilson, a senior technical officer in the Hitchin office, and sought his advice. The best that Wilson could advise him was to say: what would you do about it? Fuller said he thought the curve needed rerailing. Wilson said: well, then, put that on the form. And Fuller did."
Sentencing remarks
"(1) Failures to fulfil the general duties imposed by sections such as, for example, section 3 of the 1974 Act are particularly serious, as such sections are the foundations for protecting health and safety of the public.
(2) Historically, fines for such offences, certainly those imposed by magistrates, have been too low.
(3) It is not possible to say that a fine should stand in any specific relationship with a turnover or net profit of the defendant. Each case must be dealt with according to its own circumstances.
(4) It may be helpful to look at how far short the defendant fell of the appropriate standard.
(5) Generally, where death occurs in consequence of the breach, that is an aggravating feature. To that proposition I would add that by analogy with cases of causing death by dangerous driving, multiple deaths must be regarded as more serious than single deaths, though not, of course, standing in anything like an arithmetical relationship with them.
(6) A breach with a view to profit seriously aggravates the offence.
(7) Also relevant is or may be the degree of the risk and the extent of the danger, specifically whether it is an isolated failure or one continued over a period.
(8) The defendant's resources and the effect of a fine on its business are important. Any fine should reflect the means of the offender, and the court should consider the whole sum it is minded to order the defendant to pay including any order for costs.
(9) Mitigation will include (1) a prompt admission of responsibility and a timely plea of guilty; (2) steps taken to remedy deficiencies drawn to a defendant's attention; and (3) a good safety record.
(10) Above all, the objective of the fine imposed should be to achieve a safe environment for the public and bring that message home, not only to those who manage a corporate defendant, but also to those who own it as shareholders. Later decisions have all drawn on and confirmed the usefulness of Howe as an authority and they have added the following further points of possible application to this case.
(11) The stated objective in Howe means that consistency of fines between one case and another and proportionality between the fine and the gravity of the offence may be difficult to achieve. Consistency may not, therefore, be a primary aim of sentencing in this area of law. R v Jarvis [2005] EWCA Crim 1409 paragraph 7.
(12) The court can take a more serious view of the breaches where there is a "significant public element", particularly where the public has to trust a company entrusted with work relating to their safety to carry that work out competently and efficiently. The court can also take into account in such cases the fact, if appropriate, that is was a matter of good fortune that the risks, and presumably their consequences, did not turn out worse than in the event they did. Jarvis, again, paragraph 11.
(13) Where a defendant is a public body, it is not as such immune from criminal penalties because it has no shareholder or well-paid directors. But if a very substantial financial penalty will inhibit the cost of performance by a statutory body of a public function which it is set up to perform, that is not something to be disregarded. R v Milford Haven Port Authority CA 1999/00781/W2, 16 March 2000.
An NHS Trust, convicted under the Act, has presented this problem in a particularly acute form as was acknowledged by His Honour Judge Gordon in the first instance decision in Southwest London and St George's Mental Health NHS Trust, in this court on 5th May of this year."
"(1) These were both breaches of general duties owed to the public at large. Over the relevant period for which the breaches were in operation, something over three quarters of a million passengers will have been at risk by passing over this area of line at high speed.
(4) Both companies fell below the appropriate standard of care. In the case of Balfour Beatty, I regard their failure as lying at the top of the scale. I have spent over 30 years of my professional life involved in cases concerning the duty of care, including many of the major transportation and other disasters of the late 1980s and the 1990s.
I remind myself to guard against overreaction to this incident and I believe I have done so. But I have to say that I regard the failures of Balfour Beatty, set out above, as the worst example of sustained, industrial negligence in a high-risk industry I have seen.
Railtrack's failures were lamentable, but of a lower order by a clear margin. Mr Thwaites urged me to say that in terms of relative culpability both defendants stand in broadly the same position, or, if there is to be any disparity between them, it should not be great.
Doing the best I can and following this approach, I assess Balfour Beatty's culpability at somewhere between two and three times that of Railtrack.
(5) Four deaths are an aggravating feature of these breaches. There could easily have been more.
(6) I do not view these breaches, both being sins of omission, as having been done with a view to profit in the sense that that phrase should properly be used,
(7) These were not isolated failures in that they affected a substantial part of a busy, high-speed line for at least 21 months.
(8) Both defendants say in terms that they are in a position to pay whatever fine the court sees fit to impose. For that reason, detailed examination of their financial positions has not been necessary. I treat them both as major players in the national industrial landscape. The fact that BBRIS is entirely independent at law from its parent need not concern me in circumstances where the parent accepts the reality of the position; it is a creature through which the parent runs half of its group business.
On the other hand, I should not inflate any fine I had in mind because the parent shareholder's means are substantial. I intend to fix a fine in each case which is appropriate to be paid by a company able to pay it but one whose impact should be felt by those who own and/or control it.
(9) There is no credit for any plea of guilty, but I accept that both companies acted with exemplary urgency and took effective measures after the accident to prevent any future reoccurrence of this event.
Balfour Beatty is no longer in the business of railway maintenance, Network Rail has taken over from Railtrack and has taken maintenance in-house with a new organisation, increased funding, manpower and other resources. No-one can predict the future, but there is no doubt in my mind that the risks of such a tragedy repeating itself have been reduced by the actions of both defendants, principally those of Network Rail, to the lowest, practicable level.
This is an industry, as this case shows, full of good, devoted, loyal railwaymen. In a proper setting and given proper support they should be able to prevent a future Hatfield.
The elimination of one of the more indefensible features of the 1996 privatisation, namely, the separation of the ownership and control of the track from the execution of maintenance upon it, has now gone. Perhaps that is the one good result to have come out of this disastrous affair.
(11) I have looked at a number of authorities provided to me but, at the end of the day, none helps me in anything more than the most general sense.
(12) Self-evidently there was a "serious public element" in this matter and it is a case where par excellence large numbers of the travelling public put their trust in these two defendants and were let down."
The grounds of appeal
"1. The judge erred in concluding that BB's failure lay "at the top of the scale" and was one of "the worst examples of sustained industrial negligence in a high risk industry I have seen". He failed properly to assess the level of BB's failure and/or properly to place such failure in its correct context.
2. The judge erred in assessing BB's "culpability at somewhere between two and three times that of Railtrack" but in fining BB £10 million and Railtrack £3.5 million.
3. The level or amount of the fine imposed against BB was excessive in the circumstances and/or having regard to previous large fines of companies for HSWA offences in England and Wales.
4. The judge erred when he concluded that he was "quite unable to extend any discount to BB for the plea it entered at the stage which it entered it"."
We shall deal with each in turn.
The gravity of Balfour Beatty's fault
Balfour Beatty's fine compared to that of Railtrack
"I turn to the basis upon which Railtrack falls to be sentenced. This can be much more simply stated. It is based on Particulars 1 to 6 of Count 1. In those respects it was strictly liable for the underlying failings of its IMC and failed to satisfy the jury that it could not have done more to remedy them. It does not fall to be sentenced for its failure to rerail where it faces now no allegation or to provide grinding or to clarify its standards earlier than it did, or for any other of the criticisms made by Mr Thwaites in his mitigation.
It means I must find that its liability is more serious than an automatic or vicarious liability would have been, since it failed, itself, to do more to uncover the failings of Balfour Beatty at Hitchin. Equally, Mr Sweeney argues with some justification that A's failure to detect B's failure to do what B's duty requires him to do is, in the scale of things, less culpable than B's failure, which should be viewed as the primary and more important default. As a general proposition, I see the force of that argument. "
"Mr Thwaites correctly argues that rerailing was the only sure way of eliminating this risk. Railtrack has always accepted and, indeed, it did, within days of the crash, that it failed in this respect. Equally, it is agreed that Balfour Beatty knew or ought to have known of this continuing failure and that the responsibility for continuing inspection and maintenance of the track remained with them pending rerailing until the very minute of handing the track over to the rerailing contractor. Balfour Beatty can have been in no doubt about that. Quite plainly, however, this failure by Railtrack was a contributory cause of the crash, although it is not one which is included in this list of particulars against them. "
The judge described this as "incompetence of a serious order" and "a lamentable chapter of negligence involving Jarvis and Railtrack".
"Grinding was in the hands of Railtrack. They failed to grind the rail at all, when asked to in 1998, until September 2000 and, when they did, it was too late and too severe."
The size of the fine
In August 2005, about a month before the judge imposed the sentences in the present case, Transco was fined by the Court of Session in Scotland £15 million after contesting liability for breach of the 1974 Act in circumstances where deterioration in the condition of a gas pipeline had led to a fatal explosion. Mr Caplan submitted that the judge must have fastened on this case and decided to impose a similar fine, to be shared between Balfour Beatty and Railtrack. He submitted that Transco was not an appropriate precedent. In that case senior management had had knowledge for over a decade of the state of affairs that led to the fatal explosion.
Discussion
"142 Purposes of sentencing
(1) Any court dealing with an offender in respect of his offence must have regard to the following purposes of sentencing –
(a) the punishment of offenders,
(b) the reduction of crime (including its reduction by deterrence),
(c) the reform and rehabilitation of offenders,
(d) the protection of the public, and
(e) the making of reparation by offenders to persons affected by their offences."
Most of these can be applied in the case of a company, although there are obvious difficulties in applying subsection 1(c).
"They must have felt, in relation to counts 1, 2, 4 and 6 particularly that there was more that Railtrack could have done by way of intrusive audit, end-product checking on the ground and by way of direct action."
"would right-thinking members of the public, with knowledge of the relevant facts and circumstances, learning of this sentence consider that something had gone wrong with the administration of justice. "
That test has been applied to this day – see Archbold 2006 edition paragraph 5-101. The disparity in the two fines is so great in this case that we consider that the test is satisfied.
The effect of the guilty plea
"Balfour Beatty's 94-page defence case statement and Mr Thwaites' opening address to the jury contained no single hint of any fault or failing on behalf of Balfour Beatty's part, far from it. I have no doubt it was perceived as a matter of forensic tactics, to be of benefit, principally, to the company itself and possibly its employees, to take this line to avoid contaminating the jury's minds with any acceptance by Balfour Beatty of any criminal responsibility."
He concluded that these forensic tactics carried the consequence that no credit could be claimed for the late plea of guilty.