Should there be criminal liability for corporations?

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By Rodney Dzwairo on

Debate about corporate manslaughter thrust into spotlight following Grenfell Tower fire

Grenfell Tower – Image credit: Instagram (@jamie_mursel)

Corporate manslaughter has come into the public consciousness because of the Grenfell Tower fire, which took place a year ago today. Many in the public, including MP David Lammy, have been calling for the disaster to be investigated as manslaughter in the criminal courts.

What is not discussed in the media is the perennial controversy surrounding corporate manslaughter and the idea of holding corporations criminally liable for deaths. A good many commentators and jurists, such as American professor Vikramaditya Khanna, argue that no such liability should be imposed.

It is important to get an overview of the complicated and troublesome law in this area before discussing the justifications. Corporate manslaughter used to be governed by the common law where corporations could be held liable for gross negligence manslaughter. The courts had trouble stretching and evolving criminal doctrines that were developed to deal with people to also cover corporations.

Concepts like actus reus and mens rea were especially hard to adapt to companies. What evolved from cases like HL Bolton v TJ Graham was what was known as the identification doctrine, which essentially held that the actions of the senior management could be imputed onto the company. This meant that if a person in the senior management was grossly negligent that could be attributed to the company and liability would be found. This was extremely complex and there was only one case in which the courts were able to successfully prosecute a company for manslaughter.

The common law was eventually abolished through the Corporate Manslaughter and Corporate Homicide Act 2007. The new law, which did not drastically depart from the common law, holds:

(1) An organisation to which this section applies is guilty of an offence if the way in which its activities are managed or organised-
(a) causes a person’s death, and
(b) amounts to a gross breach of a relevant duty of care owed by the organisation to the deceased.

But, should corporations be prosecuted for manslaughter? And are the aims of the criminal law being achieved through such prosecutions?

Khanna makes compelling points on why corporate liability should be abolished. Firstly, he notes that the criminal law has failed to effectively deal with corporate manslaughter. This is supported by the fact that under the common law there was only one successful prosecution, and there have been about 25 successful prosecutions under the statute.

Khanna further argues that the civil law is better suited to deal with gross negligence manslaughter. According to him, the civil law courts can assess the damage of a corporation’s negligence better and provide more flexible compensation to victims.

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Furthermore, unlike the criminal law, which uses ‘beyond reasonable doubt’ as its burden of proof, the civil law uses the less stringent ‘balance of probabilities’. This could lead to more practical justice as the burden of proof in the criminal courts is, in some cases, onerous.

The emphasis of Khanna’s argument is that the criminal law is not the most efficient means of dealing with death resulting from corporations.

On the opposite side of the argument is retired law professor Chris Clarkson, who is a proponent of maintaining corporate manslaughter. According to him, if corporations commit what amounts to manslaughter, they should on principal be held liable. Per Salomon v Salomon, corporations are awarded the benefit of legal personhood. It would be illogical and incoherent for the law to provide corporations with the legal benefits of personhood without also imposing the burdens.

Clarkson goes on to note that the criminal law provides a certain deterrence and censure the civil law cannot. In finding a corporation liable for manslaughter, its conduct is publicly condemned and its reputation tarnished. This provides a certain incentive to prevent such future harms as a company’s reputation is one of its vital assets.

Clarkson essentially argues that criminally prosecuting corporations for manslaughter achieves desirable consequentialist outcomes like deterrence and condemnation.

Clearly, there are compelling arguments on both sides of the debate. I, however, fall in the Clarkson camp. I believe it would be morally repugnant for the criminal law not to prosecute the gross negligence of companies that result in numerous deaths. It is important such tragically preventable deaths such as during the Grenfell disaster be unequivocally condemned in a court of law.

While corporate manslaughter should exist as a criminal offence it is important to note the law is severely in need of reform. The current law is wholly ineffective at prosecuting most corporations because of restrictive elements such as the senior management requirement. Hopefully, the law commission will reconsider the current law.

Rodney Dzwairo is a first-year law student at the University of Warwick. He’s an aspiring commercial solicitor.

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