Question

In: Accounting

1. A parent company be prosecuted because of failures within a subsidiary company True False 2....

1.

A parent company be prosecuted because of failures within a subsidiary company

True

False

2.

When an employee is killed while driving on work-related business, the employer organisation could be prosecuted for corporate manslaughter.

True

False

3.

The Corporate Manslaughter and Corporate Homicide Act 2007, is not retrospective and therefore can apply to deaths before its implementation date.

True

False

4.

When deciding what constitutes gross negligence it can be said that negligence turns into gross negligence if the breach of duty falls considerably below what would reasonably be expected of the organisation in the circumstances. Whether the negligence is gross negligence depends upon considerations such as: (tick all that apply)

Any health and safety guidance relating to the breach

The cost of installing safety systems and taking precautions

The attitudes, policies and accepted practices of the organisation which led to the failure

That there were no mitigating factors

Whether other people involved in the incident suffered serious injuries

How serious the failure was

How real the risk of death was

The number of people who died

5.

Historically in larger companies, it was often difficult to prove that the actions of one director or manager controlled the whole company. In the case of large companies, the prosecution often tried to secure a conviction for breach of the Health and Safety at Work Act 1974 which is easier to prove. Which of the cases listed below (which occurred before the CMCHA 2007 )resulted in convictions for corporate manslaughter? (Tick all that apply)

R v Kite, Stoddard and OLL Ltd [1994]

R v Cotswold Geotechnical (Holdings) Ltd [2011]

Tesco Supermarkets Ltd. v Nattrass [1971]

R. v P & O European Ferries (Dover) Ltd. (1990)

Williams v Farne Salmon and Trout Ltd 1988

R v Princes Sporting Club Limited (2013)

Solutions

Expert Solution

1. A parent company be prosecuted because of failures within a subsidiary company?

Answer: False.

A general rule is that only the subsidiary company, responsible for the breach need to be taken into consideration. Only in exceptional cases, resources of a parent company can be taken into account only when it can be demonstrated in-front of the court that sufficient evidence is present against the parent.

2. Answer: True.

Employers are responsible for the health and safety of their employees when they are using own or rented vehicle for work-related capacity. Work related journey may include travelling to office, client visit, supplier visit etc. Breach of this duty can attract penalty with criminal prosecution to the company.

3. False.

The Corporate Manslaughter and Corporate Homicide Act 2007 came into force on 6th April, 2008 and death occurred after this date would be covered under this law. This new law is not retrospective and therefore cannot apply to deaths before its implementation date. Deaths happened before 6th April, 2008 would still be covered under the previous law on Manslaughter.

Old law tried to pin point a corporate head or CEO, who normally called as ‘controlling mind’ and make him personally responsible for the offence. Where as, CMCHA 2007, has a wider scope and it look for the offences and failing of the organisation as a whole.

4.

Negligence is gross negligence if defended was in breach of his duty and failed to take good care of the victim who died while performing his duty. The following factors should be considered while assessing for any breach occurred.

1. Any health and safety guidance relating to the breach.

2. The attitudes, policies and accepted practices of the organisation which led to the failure

3. How serious the failure was

4. How real the risk of death was.

5. The following cases(which occurred before the CMCHA 2007 )resulted in convictions for corporate manslaughter before CMCHA 2007 came into force.

1. R v Kite, Stoddard and OLL Ltd [1994]

2. R. v P & O European Ferries (Dover) Ltd. (1990)


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