R v Sellafield Ltd
| Jurisdiction | England & Wales |
| Judge | Mr Justice Mitting,Mrs Justice Thirlwall |
| Judgment Date | 17 January 2014 |
| Neutral Citation | [2014] EWCA Crim 49 |
| Court | Court of Appeal (Criminal Division) |
| Date | 17 January 2014 |
| Docket Number | Case Nos: 2013/03604/A7 & 2013/03860/A7 |
[2014] EWCA Crim 49
IN THE COURT OF APPEAL CRIMINAL DIVISION
ON APPEAL FROM THE CROWN COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
THE LORD CHIEF JUSTICE OF ENGLAND AND WALES
Mr Justice Mitting
and
Mrs Justice Thirlwall
Case Nos: 2013/03604/A7 & 2013/03860/A7
Richard Matthews QC and Eleanor Sanderson for the appellant Sellafield Limited
Barry Berlin (instructed by the Principal Solicitor at the Environment Agency and Senior Solicitor of the Health and Safety Executive) for The Crown
Prashant Popat QC and Oliver Campbell for the appellant Network Rail Infrastructure
Sarah Le Fevre (instructed by the Prosecutor at the Office for Rail Regulation) for The Crown
The Lord Chief Justice of England and Wales:
Introduction
These two appeals are being heard together as they raise issues of principle in relation to the level of fines to be imposed for breaches of safety and environmental protection legislation on very large companies — Sellafield Limited (Sellafield Ltd) with a turnover of £1.6bn and Network Rail Infrastructure Ltd (Network Rail) with a turnover of £6.2bn.
i) Sellafield Ltd was fined £700,000 at the Crown Court at Carlisle on 7 February 2013 for offences arising out of the disposal of radioactive waste.
ii) Network Rail was fined £500,000 in the Crown Court at Ipswich on 27 June 2013 for an offence arising out of a collision at an unmanned level crossing, causing very serious injuries to a child.
Both companies seek leave to appeal on the basis that the fines were manifestly excessive. We grant leave.
The general principles
It is important at the outset to recall the provisions which Parliament has enacted in the Criminal Justice Act 2003 ( CJA 2003) in relation to the duty of the courts in sentencing, as these principles are applicable to all offenders, including companies:
i) The courts must have regard in dealing with offenders to the purposes of sentencing which Parliament specified as (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 ( s.142 of the CJA 2003).
ii) In considering the seriousness of the offence the court must have regard to the culpability of the offender and the harm caused or which might foreseeably be caused ( s.143 of the CJA 2003).
iii) If a court decides on a fine it must approach the fixing of fines having regard not only to the purposes of sentencing and the seriousness of the offence, but must also take into account the criteria set out in s.164 of the CJA 2003:
(1) Before fixing the amount of any fine to be imposed on an offender who is an individual, a court must inquire into his financial circumstances.
(2) The amount of any fine fixed by a court must be such as, in the opinion of the court, reflects the seriousness of the offence.
(3) In fixing the amount of any fine to be imposed on an offender (whether an individual or other person), a court must take into account the circumstances of the case including, among other things, the financial circumstances of the offender so far as they are known, or appear, to the court.
(4) Subsection (3) applies whether taking into account the financial circumstances of the offender has the effect of increasing or reducing the amount of the fine.
There can be no doubt as to the objective in applying these principles when sentencing a company for offences against health and safety and environmental legislation. As Scott Baker J stated in giving the judgment of this court R v F Howe & Son (Engineers) Ltd [1999] 2 All ER 249 at 255, [1999] 2 Cr App R (S) 37 at 44
"The objective of prosecutions for health and safety offences in the work place is to achieve a safe environment for those who work there and for other members of the public who may be affected. A fine needs to be large enough to bring that message home where the defendant is a company not only to those who manage it but also to its shareholders."
Where a fine is to be imposed a court will therefore first consider the seriousness of the offence and then the financial circumstances of the offender. The fact that the defendant to a criminal charge is a company with a turnover in excess of £1 billion makes no difference to that basic approach.
The fine must be fixed to meet the statutory purposes with the objective of ensuring that the message is brought home to the directors and members of the company (usually the shareholders). The importance of the application of s.164 in relation to corporate defendants was reinforced in the Definitive Guideline of the Sentencing Guidelines Council Corporate Manslaughter & Health and Safety Offences Causing Death, published in 2010. It has been reflected in more recent decisions of this court: see for example: R v Tufnells Park Express Ltd [2012] EWCA Crim 222 at para 43 (the fine after trial on a company with a turnover of £100m and profitability of £7.7m was £225,000; this represented, as the court noted, 2.9% of its operating profit).
It will therefore always be necessary in the case of companies with a turnover in excess of £1 billion to examine with great care and in some detail the structure of the company, its turnover and profitability as well as the remuneration of the directors. Although the appellant companies are similar in that they are companies with such a turnover, they differ considerably. Sellafield Ltd is an ordinary commercial company which makes profits for its shareholders who are large multinational companies. In contrast, the parent company of Network Rail, Network Rail Limited, has no shareholders who receive profits; its members derive no profit from the company. It invests its profit in the rail infrastructure. Both discharge important services of a public nature that have from time to time been directly undertaken by the State. This appeal illustrates the close analysis required. We turn to that analysis at paragraphs 52 and following after we have set out the facts and considered the seriousness of the offence; as this court has repeatedly stated, the size of the penalty will depend on the facts of each case.
THE SERIOUSNESS OF THE OFFENDING OF SELLAFIELD LTD
(1) The stringent standards of safety imposed by the legislative regime
The processing and storage of nuclear waste is a by-product of an activity of national economic importance: the generation of electricity by nuclear power.
It carries with it potentially grave risks. To mitigate those risks the most stringent standards have been adopted at national and international levels. In the United Kingdom they have been laid down in licences granted under the Radioactive Substances Acts 1948, 1960 and 1993 and, more recently, by the Environmental Permitting Regulations 2010. The UK is also a signatory to the European Agreement for the International Carriage of Dangerous Goods by Road — an agreement made under UN auspices — to which effect is given by the Carriage of Dangerous Goods and Use of Transportable Pressure Equipment Regulations 2009. These instruments set out detailed and specific provision for the sorting, carriage and disposal of nuclear waste.
The public rightly expects strict compliance with those standards.
(2) The offences committed
Between 15 November 2008 and 19 April 2010 Sellafield Ltd breached those standards in a variety of ways in relation to the system for segregating non-radioactive waste from radioactive waste and for disposing of it.
On 7 February 2013, Sellafield Ltd had pleaded guilty at the Magistrates' Court at Workington to seven offences. The Magistrates committed Sellafield Ltd to the Crown Court as they considered their sentencing powers were insufficient; the maximum penalty they could have imposed was £230,000.
A fine of £700,000 was imposed on 14 June 2013 by HH Judge Peter Hughes QC at Carlisle Crown Court, being made up of a fine of £100,000 for each of the seven offences. Five contraventions of different statutory requirements were set out in seven charges. Two pairs of charges covered the same factual allegations, but were separately laid because of change in the statutory regime which took effect on 5 April 2010. Sellafield Ltd
i) Operated a regulated facility other than in accordance with an environmental permit on or about 12 April 2010 by disposing of radioactive waste at a landfill site contrary to Regulation 38(1) of the Environmental Permitting (England and Wales) Regulations 2010.
ii) Failed to comply with or contravened a condition of an authorisation or permit by failing to check the effectiveness of systems equipment and procedures for the disposal of radioactive waste contrary to Section 13 of the Radioactive Substances Act 1993 between 1 November 2009 and 5 April 2010 and Regulation 38(2) of the 2010 Regulations between 6 April and 19 April 2010.
iii) Failed to comply with or contravened a condition of an authorisation or permit by failing to have a management system, organisational structure and resources in place sufficient to achieve compliance with their conditions contrary to Section 13 of the 1993 Act between 15 November 2008 and 5 April 2010 and Regulation 38(2) of the 2010 Regulations between 6 April and 19 April 2010.
iv) Did not comply with a condition of an authorisation or permit by failing, prior to 5 April 2010, to comply with appropriate criteria for accepting...
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