R v L and Another

This appeal by the Crown under section 58 Criminal Justice Act 2003 raises questions relating to the criminal liability of an unincorporated association and of its individual members.

An underground pipe taking heating oil from its storage tank to the boiler was fractured when independent building contractors carried out work on the ground above. The heating oil escaped through the ground and some 1500 litres or more found its way into a nearby watercourse, polluting it. The land on which tank, boiler and pipe all lay was occupied by an unincorporated association, namely a members' golf club. The club also owned those several installations.

The Environment Agency initiated a prosecution against two members of the club, selected because at the time of the escape the first (L) was the club chairman and second (F) was both the club treasurer and also chairman of the 'special building committee' which, within the club, oversaw the building work in question carried out by the contractors. By the time of the ruling by the Judge with which we are now concerned, the prosecution had abandoned any allegation that either defendant was personally culpable in any manner, nor was there any allegation that either had done anything to make him criminally liable beyond being a member of the club which maintained the tank and pipe. The club had 900 or so members. Any one or all of those members would have been in an identical legal position.

The offence charged was that created by section 85 of the Water Resources Act 1991. That section provides as follows:

“(1) A person contravenes this section if he causes or knowingly permits any poisonous, noxious or polluting matter….to enter any controlled waters.”

Here the charge was causing, rather than knowingly permitting. Liability for this offence is, if not absolute, extremely strict, notwithstanding its juxtaposition in the statute with the neighbouring offence of knowingly permitting. On the authority of the decision of the House of Lords in Environment Agency (formerly National Rivers Authority) v Empress Car Co (Abertillery) Ltd [1999] 2 AC 22, and of other authorities there reviewed, it may be committed by maintaining a tank containing a polluting substance which escapes into a watercourse even if the immediate occasion of the escape is the unforeseeable act of a third party, providing that that intervening act can be described as a normal fact of life as distinct from an extraordinary and abnormal event. Even an intervening interference by a trespasser may lead to the criminal responsibility of the tank owner. The decision in that case was that in such circumstances maintaining the tank causes the pollution.

By section 85(6) a person convicted on indictment of the offence is liable to imprisonment for up to two years and/or to a fine.

At the outset of the trial the Defendants sought a ruling from the Judge upon motion to quash the indictment. He ruled in their favour, deciding: (i) that the golf club could have been prosecuted as an unincorporated association for this offence and (ii) that, at least in the absence of some personal culpability, the two individual defendants could not be so prosecuted.

Against that ruling, the Crown seeks leave to appeal. It complied at the time with the procedural requirements of section 58 Criminal Justice Act 2003, in that it notified the Court under s 58(4) of its intention to appeal and gave the section 58(8) acquittal agreement. The Judge declined to give leave himself, taking the view that leave should be a matter for this court.

Does section 58 apply ?

The defendants submit that the Crown cannot appeal under section 58 because the prosecution was not terminated; the Crown, it is said, could perfectly well bring a prosecution against the club as an unincorporated association, for that is what the Judge ruled could be done. Says Mr Fryer, the defendants merely asked the Judge for clarification of who could be prosecuted.

The argument based upon whether the ruling is a 'terminating' one is in any event misconceived. Such an expression does not appear anywhere in the Act: see R v Y [2008] EWCA Crim 10, at paragraph 20 and R v R [2008] EWCA Crim 370 at paragraph 24. This ruling undoubtedly related to the count on the indictment and is a proper subject for appeal under section 58. As it happens, in the present instance the ruling did also terminate the case, although that is not the test. The only persons prosecuted on the indictment were these two defendants and the Judge ruled that in the absence of some personal culpability that prosecution could not succeed. That the Crown could (if his ruling be right) start again against the club would not mean that the prosecution which was in hand survived.

We are quite satisfied that the Crown was entitled to invoke section 58. We are also satisfied that the ruling raises one or more questions of law which are both arguable and suitable for consideration by this Court. Accordingly we give leave.

Unincorporated Associations

There are probably almost as many different types of unincorporated association as there are forms of human activity. This particular one was a club with 900 odd members, substantial land, buildings and other assets, and it had no doubt stood as an entity in every sense except the legal for many years. But the legal description 'unincorporated association' applies equally to any collection of individuals linked by agreement into a group. Some may be solid and permanent; others may be fleeting, and/or without assets. A village football team, with no constitution and a casual fluctuating membership, meeting on a Saturday morning on a rented pitch, is an unincorporated association, but so are a number of learned societies with large fixed assets and detailed constitutional structures. So too is a fishing association and a trade union. And a partnership, of which there are hundreds of thousands, some very large indeed, is a particular type of unincorporated association, where the object of the association is the carrying on of business with a view to profit.

At common law, an unincorporated association is to be distinguished from a corporation, which has a legal personality separate from those who have formed it, or who manage it or belong to it. The most numerous species of corporation is the limited liability company, but there are of course other types, such as chartered professional associations, local government bodies and indeed bishops. At common law, as the Judge succinctly held, an unincorporated association has no legal identity separate from its members. It is simply a group of individuals linked together by contract. By contrast, the corporation, of whatever type, is a legal person separate from the natural persons connected with it.

This is an apparently simple legal dichotomy duly learned by every law student in his first year. But its simplicity is deceptive. It conceals a significantly more complicated factual and legal position.

As to fact, many unincorporated associations have in reality a substantial existence which is treated by all who deal with them as distinct from the mere sum of those who are for the time being members. Those who have business dealings with an unincorporated partnership of accountants, with hundreds of partners world-wide, do not generally regard themselves as contracting with each partner personally; they look to the partnership as if it were an entity. The same is true of those who have dealings with a learned society, or a trade union, or for that matter with a large established golf club. Frequently, as Lord Phillips CJ pointed out in R v W Stevenson & Sons [2008] EWCA Crim 273 (at paragraph 23) third parties will simply not know whether the organisation being dealt with is a company or some form of unincorporated association.

As to the law, it no longer treats every unincorporated association as simply a collective expression for its members and has not done so for well over a hundred years. A great array of varying provisions has been made by statute to endow different unincorporated associations with many of the characteristics of legal personality. Examples selected at random include the following. The detailed special rules for partnerships contained in the Partnership Act 1890 scrupulously preserve the personal joint and several liability of the partners (see sections 5–12), and the Law Commission recommendation in November 2003 that a firm should have legal personality has not been implemented, but the partnership can sue or be sued in its firm name: see Civil Procedure Rules 7.2A and 7PD5A.3, repeating a rule which has existed for more than a century. A Trade Union is, by statute, not a corporation: Trade Union and Labour Relations (Consolidation) Act 1992 section 10(1). But by the same section it can make contracts, sue and be sued in its own name, and commit a criminal offence. In the case of learned societies and institutions, their property (if not vested in trustees) is by section 20 of the Literary and Scientific Institutions Act...