15th November 2012
What price innocence?
Specialist regulatory lawyer at Cartwright King Andrew Brammer considers the impact of recent changes in the law on the costs of fighting criminal litigation, and the simple steps any business can take to protect itself.
Every business is bound by regulations, and almost all regulations carry a sanction of criminal liability if breached. This means that failure to fulfil a legal obligation (like health and safety) can result in a criminal investigation and possibly expensive litigation in the criminal courts. Regulations are designed to place the duty of “proving” your innocence on the business, and in the absence of legal aid, this can mean big legal bills for a business.
In the “good old days”, if a company prosecuted in the criminal courts for breaching regulations could demonstrate on a balance of probabilities that it had fulfilled its legal duties, was innocent and therefore not guilty, it was able to recover its reasonable legal expenses from the Court (see Court read Government). This was called a Defendant’s Costs Order (DCO). Unfortunately all this has now changed and new laws in force mean that the price of innocence has just gone up.
Now, for cases started after 1 October 2012, if a company successfully proves its innocence in Court it cannot claim a DCO, and the funds spent in successfully defending itself are lost. So here are a few simple steps you can take now to start to protect your business:
- Avoid the problem in the first place: make sure that your current regulatory compliance systems are fit for purpose. Again if you have any doubts or are unsure about what regulatory compliance involves, then speak to a lawyer specialising in this area.
- Have a plan: design a plan of action for managing any incident that might give rise to a criminal investigation, or criminal court proceedings. This must involve your lawyers from the start. Early advice and intervention in any regulatory breach case is crucial. A good regulatory lawyer will be able to work with you in compiling your plan or recommend a specialist contractor that can.
- Get advice: make sure you have at your disposal a lawyer that understands regulatory compliance and specialises in dealing with these types of cases. Access to trusted and immediate advice is crucial when the pressure is on.
- Insurance: find insurance that you are comfortable with. It is a buyers’ market and, if in doubt, work with your broker to find cover that deals with your obvious and immediate liabilities but also recognises that you have the right to instruct a solicitor of your choice (despite what you may be told) and that this is accepted from the start by your insurer. Your lawyer should be able to advise you about this, if not speak to one that can.
And finally, Legal Aid may now be available. Recognising that it cannot entirely eliminate access to justice, the Government appears to have given companies the potential to apply for Legal Aid. This is very new and yet untested and, as you would expect, the process is difficult so advice from a lawyer with Legal Aid experience is vital.
In a nutshell, where possible avoid the problem in the first place otherwise take good advice early.
Andrew Brammer is an expert regulatory lawyer with Cartwright King Solicitors. Cartwright King are a leading national criminal and regulatory firm who are able to undertake Legal Aid work for companies where eligible.