THE RISE OF ARTICLE 32(8)
It is not uncommon, following an audit by the Fire Service (where breaches may have been found) for a company to go into liquidation. The more cynical of us may suggest that many companies enter into liquidation to avoid any potential enforcement action by the Fire Service. The less cynical would argue that companies with financial difficulties are less likely to comply with fire safety responsibilities.
Whatever the reason, Fire Services are increasingly resorting to the use of Article 32(8) to prosecute the Officers of a Body Corporate for the offences committed by the companies they are involved with or responsible for. Article 32(8) allows for enforcement action or a prosecution against any individual officer of a company who had some control over breaches of the FSO.
Where a corporate employer, who may have been the Responsible Person under Article 3 has gone into liquidation, this can be a very effective tactic for holding the Company Officers to account and which may prevent them from starting up fresh companies and continuing with the same attitude towards fire safety.
But prosecuting under Article 32(8) is not without its difficulties. First of all the Prosecution would have to prove that offences had been committed by the Body Corporate. Effectively this would involve a dual prosecution where the onus is to prove that the Body Corporate committed the offences and, in addition, that those offences were committed with either:- a) the consent, b) the connivance, or c) the neglect on the part of a Company Officer.
It is helpful that Article 32(10) states that the Officer of the Body Corporate can still be prosecuted whether or not proceedings are taken against the company itself. However, it is still necessary to prove that the company committed the offence and that it was done with either the consent, connivance or neglect of the Officer of the Company.
In my experience, only Company Directors have been prosecuted under Article 32(8). In addition, these prosecutions have usually taken place where there is a sole Director/Shareholder.
In such cases the culpability is clear. The person with control of the company is held to account where the company no longer exists for failing to take the appropriate decisions to keep premises safe. I would argue that in such cases the Sole Director/Shareholder could still be prosecuted as a person with control of the premises under Article 5(3). Clearly, as the Director/Shareholder has control of the company, he has control over the decision making in respect of fire safety measures for the premises. Article 5(3) states that he can be liable to the extent of his control and I have conducted a number of prosecutions on that basis.
It becomes more difficult with insolvent companies with two or more Directors or Shareholders. Part 2 of the Guidance Documents states that a company Board should appoint a Director to be responsible for fire safety. If certain members of the Board state that fire risk management was not their responsibility and can point to the appropriate Director whose responsibility it was, then this may be a strong defence to any prosecution under Article 32(8).
It must also be remembered that the Article is not confined to Directors and Shareholders. It refers to ‘managers, secretary or other similar Officers of the Body Corporate’. This could cause evidential difficulties where a Director/Shareholder states that a person was employed specifically to take care of fire risk management responsibilities and failed to carry out those tasks in accordance with the Order. The prosecution against the Director or Shareholder in those circumstances would leave itself open to the question as to why the appropriate “Officer” was not prosecuted under Article 32(8).
The strict liability aspect of Article 32(11), (which states that the employer in any criminal proceedings does not have a defence for any breach of the Order by an employee of his), would not apply as the Director/Shareholder would not be the employer for those purposes. The employer would still be the insolvent company.
I have also been involved in prosecutions where a company which is not insolvent, has been prosecuted together with a Director/Shareholder under Article 32(8). Given the hierarchy of Article 5(3) it has to be questioned whether it was the intention of the Order to prosecute company officials as well as the employer as a Responsible Person under Article 3?