The Chevron case and Enforcement Notices – A favourable outcome for corporate bodies?
The Supreme Court has ruled against the Health and Safety Executive (HSE) in a case involving the issue of an Enforcement Notice.
Earlier this month the Supreme Court issued its long awaited judgment in the case of the Health and Safety Executive (HSE) v Chevron North Sea Limited.
Dealing specifically with the issue of what a Tribunal can take into account when determining an appeal against either a Prohibition or Improvement Notice, the proceedings first started as far back as 2013.
What was the background?
In April 2013 the HSE served a Prohibition Notice on Chevron, who operate an offshore installation in the North Sea, after an inspector had concerns about the strength of a metal stairway leading to the helideck.
Chevron launched an appeal against the Notice in May 2013 and, in March 2014, they obtained an expert’s report concerning the stairway in question. This concluded that all of the metalwork passed the British Standard strength test and therefore there was no risk of personnel being injured.
Not surprisingly, Chevron wanted to rely on the report of their expert at the appeal hearing. The HSE disputed this point and argued that the remit of the Tribunal should be limited to information that was known or ought to have been known by the inspector at the time the Prohibition Notice was issued.
What was the conclusion of the Supreme Court?
Despite persistent efforts by the HSE to the contrary, the Supreme Court concluded that a Tribunal should be allowed to take into account material that has become available after an Enforcement Notice is served when determining an appeal and, specifically, when deciding whether to affirm, modify, or cancel such a Notice.
The Supreme Court emphasised that an appeal against an Enforcement Notice is not simply an appeal against an inspector’s view at the time the Notice was served. Rather it is an appeal against the Notice itself and therefore it would be unfair to restrict a Tribunal by not allowing it to take into account information that has come to light after a Notice has been served.
How will this judgment impact on companies in the future?
Put simply, the judgment by the Supreme Court appears to be one which is overwhelmingly favourable to companies who can now, without any hesitation, rely on evidence that they have obtained following receipt of an Enforcement Notice.
The days of Tribunals deciding appeals based on the often limited information that was known to an investigator at the time a notice was served are now over, and companies can feel confident that Tribunals can make informed and indeed fair assessments at appeal hearings.
The question of whether this will make Regulators temper their approach to issuing notices freely will be revealed in due course.
Whatever the approach by Regulators in the future, Enforcement Notices remain a serious matter. They can have a crippling effect on a company’s ability to operate and remain commercially viable.
Increasingly, they are cited by Regulators in Court as a means of increasing the level of punishment handed out to corporate defendants.
If you are unfortunate enough to be served with an Enforcement Notice then it is imperative that you seek expert legal advice at the earliest opportunity as you only have 21 days to lodge an appeal.
With the penalties now available to the Courts, such as unlimited fines, there has never been a more important time to challenge Enforcement Notices. Equally, following the decision in Chevron, nor has there been a better time to challenge them.
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The content of this page is a summary of the law in force at the date of publication and is not exhaustive, nor does it contain definitive advice. Specialist legal advice should be sought in relation to any queries that may arise.
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