Canada: After Metron: The Corporate Criminal Liability Landscape in Canada

Last Updated: August 20 2012
Article by Jeremy Warning, Cheryl Edwards and Shane D. Todd

On December 24, 2009, at approximately 4:30 p.m., a swing stage collapsed on a construction project at 2757 Kipling Avenue, Toronto. At least six workers were on the stage at the time of the collapse. Five of them fell approximately 14 floors to the ground. A sixth worker (the only one properly attached to a "lifeline") was held by his lifeline and was pulled to safety onto a nearby balcony.

Four of the five workers who fell died as a result of their injuries from the fall. [...] The fifth worker [...] suffered significant injuries, but survived the fall.

Based on these dreadful and widely-known facts Metron Construction Corporation ("Metron") has been found guilty of a single charge of criminal negligence causing death. On July 13, 2012, after hearing and considering submissions from the Crown and Metron, the Ontario Court of Justice sentenced Metron to a $200,000 fine.1

The Court also imposed a $90,000 fine on Metron's president after he pleaded guilty, as a company director, to four charges under the Ontario Occupational Health and Safety Act ("OHSA").2 All criminal charges against the company president were withdrawn by the Crown as a result of these guilty pleas.

From the perspective of workplace safety, the Metron case is remarkable in a number of ways. The case: r Represents the first corporate criminal negligence conviction in Ontario following passage of Bill C-45 in 2004. The sentences imposed on Metron and its president are the highest monetary penalties imposed for a workplace accident under the Criminal Code and the OHSA. They are likely to be reference points for sentences imposed in future cases under the OHSA and the Criminal Code;

  • Has had a significant impact outside of the courtroom. The Christmas Eve 2009 tragedy is widely regarded as a significant factor in motivating the review of the occupational health and safety system in Ontario. That review resulted in a number of fundamental changes to the regulatory system and there are many changes yet to come;
  • Demonstrates how Bill C-45 has managed to broaden the means by which to prove criminal negligence.

The Metron case appears to show that one of the main objectives in amending the Criminal Code - making it easier to obtain criminal negligence convictions against organizations - has been met. Whether this will embolden police and prosecutors to pursue more corporate criminal negligence charges following workplace accidents remains to be seen.

In this Update, we discuss the significance of the case and what it represents in the evolution of corporate criminal liability for health and safety in Canada.

Basis for the Criminal Negligence Finding: The Detailed Facts Revealed

Several of the facts about the December 24, 2009 accident are common knowledge due to the media coverage of this event. However, the facts presented to the court to support a conviction on the charge of criminal negligence causing death reveal significant details that were not widely known. Those facts allow for fuller context on the accident and should be considered by all organizations.

a) Liability Founded on Behaviour of Site Supervisor The agreed facts reveal that the conduct that attracts criminal liability to Metron is entirely that of the Site Supervisor - one of the deceased. It was agreed that the Site Supervisor was a "senior officer"3 of Metron. He was responsible for managing an important aspect of the organization's activities - the construction project at 2757 Kipling Avenue - and he had a duty to take reasonable steps to prevent injury to the workers he was managing. This is notable because, prior to the enactment of Bill C-45, the Site Supervisor was not someone whose conduct would likely attract criminal liability for the corporation. He was not employed directly by Metron. He had his own construction company and was hired by the Project Manager who has also been charged under the Criminal Code and the Occupational Health and Safety Act.4 As such, Metron's conviction demonstrates how Bill C-45 has expanded the potential routes for establishing criminal negligence by a corporation.

Organizations should take note. Establishing liability based on the conduct of a person like the Site Supervisor may not prove unique to Metron. It is common for organizations to have site supervisors, branch, store or plant managers, or some equivalent position. Individuals in these roles are not typically in the upper echelons of the corporate hierarchy, but do have a high degree of responsibility and authority at a localized level. Based on the definition of "senior officer" in the Criminal Code it does not appear likely that the result would have been different if the Metron case involved a larger, more hierarchical organization. Metron demonstrates that the behaviour of people with a high degree of localized responsibility can attract criminal liability for an entire organization.

b) Positive Steps Taken by Corporation What is also signifi cant about the criminal negligence being grounded solely on the conduct of the Site Supervisor is that his conduct displaced a number of positive steps that were taken by Metron prior to the accident. The facts accepted in court reveal that Metron had taken several steps inconsistent with wanton and reckless disregard for the lives and safety of the workers on the project. The Crown agreed that Metron representatives had: r Required that before any work commenced, the owner of the building arrange for an engineering inspection and recertification of the roof anchors to ensure compliance with safety requirements;

  • At all times, been cooperative and complied with all requests made by the Ministry of Labour inspector who had periodically inspected the project from October to December 2009;
  • Conducted periodic meetings with the Ministry of Labour inspector;
  • Arranged for the Project Manager to take a three-day swing stage training course, which included some fall arrest training, through the Construction Safety Association of Ontario ("CSAO")5;
  • Arranged for the Project Manager to attend, immediately after the three-day course, another CSAO course that provided instruction on how to train workers regarding the safe and proper use of suspended access equipment;
  • Made arrangements for the Site Supervisor to take a fall arrest course, provided by a third-party training provider, and a swing stage operations course provided by the Project Manager;
  • Arranged for other workers on the project to take a fall arrest course and swing stage operations course that were to be taught by the Project Manager or the third-party training provider; r Ordered copies of a comprehensive safety manual and instructed that a copy be given to each worker;
  • Conducted periodic meetings with workers, during the project, to review safety requirements including the use of swing stages; and
  • As dictated by the Metron Safety Manual, performed weekly job site inspections, which referenced both swing stages and fall protection equipment, and were recorded and submitted to Metron.

It was also agreed that Metron's president attended the project at least once per week and that he had not observed any violations on the site.

c) Conduct of Third-Party Swing Stage Provider In addition, factors contributed to the accident that did not directly involve the conduct of Metron. The agreed facts indicate a significant cause of the swing stage collapse was the design, including that the welding completed by or for the swing stage manufacturer was defective. Had the design, including the welds, not been defective, it was agreed that the swing stage would likely not have collapsed.

The agreed facts also detail that the involved swing stage was assembled by Metron workers under the supervision of the Site Supervisor and/or Project Manager and consisted of components that did not have markings or identifiers regarding the stage's maximum capacity as required by industry standard and the OHSA. As well, post-accident examination of the swing stage revealed that the welds were cracked and broken prior to the collapse and the pin or bolt holes that connected the swing stage's modules were stressed, worn and elongated. The agreed facts do not indicate whether these conditions were something that ought to have been detected by Metron or were otherwise evidence of a marked departure from the standards expected.

d) Conduct of Site Supervisor Displaces Positive Steps by Corporation The conduct of the Site Supervisor that displaced the positive steps that were taken by Metron, and was agreed as sufficient to render Metron criminally negligent, included:

1. Directing or permitting six workers to work on the swing stage when he knew, or should have known, that it was unsafe to do so. The accident occurred close to the end of the working day and the men had boarded the swing stage to travel to the ground to prepare to close and leave the project. The swing stage that was in use would have been rated to carry 1,000 pounds. The weight of the six workers and the construction equipment that was with them would have exceeded the rated capacity of the swing stage.6

2. Directing or permitting six workers to board the swing stage knowing that only two lifelines were available. The usual practice was to only have two workers on the swing stage at a time. The workers on the swing stage, given the height at which they were working, were required by the OHSA and industry standard to be protected by a fall arrest system. As part of a fall arrest system, each worker is to have their own lifeline. At the time of the accident, there were only two lifelines available for the six workers on the swing stage.

3. Permitting workers under the influence of drugs to work on the project. The agreed facts reveal that post-mortem toxicological analysis determined that three of the four deceased, including the Site Supervisor, had marijuana in their system. The level at which it was detected was consistent with recent ingestion. The agreed facts do not indicate anything about possible impairment or potential marijuana use by the Project Manager or the two workers who survived the accident.

A review of the agreed facts suggests that these factors were considered cumulatively to establish that Metron had failed to take reasonable steps to prevent bodily harm and death and, in so doing, had demonstrated wanton and reckless disregard for the lives or safety of others. We do not know if any of these actions, taken alone, would be sufficient to establish criminal negligence. Criminal negligence is not established by the mere breach of a health and safety requirement or industry standard. There must be wanton or reckless disregard for lives or safety before the departure from a legislated or industry standard becomes criminal.

The Sentences and Their Significance

a) Metron's President The $90,000 fine imposed on Metron's president is the highest monetary penalty ever imposed against an individual convicted of an offence under the OHSA. Previously, the highest monetary penalty imposed on an individual had been a fine of $70,000.7

The fine imposed also exceeds that levied against the first defendant charged following the enactment of Bill C-45. In 2005, the owner of a small contracting firm, who was charged with one count of criminal negligence causing death after a worker was killed by the collapse of an excavation, pleaded guilty to three charges under the OHSA and was fined $50,000. As a result of the pleas to the OHSA charges, the Crown withdrew the Criminal Code charge.8

b) Metron

The sentence of $200,000 imposed on Metron is the highest ever imposed for a criminal negligence conviction involving workplace health and safety in Canadian history. Prior to this decision there had only been one prior sentence imposed on a corporation since the passage of Bill C-45. That was a $100,000 fine imposed in 2008 on Transpavé Inc. The St-Eustache, Quebec based company pleaded guilty to one charge of criminal negligence causing death after a worker was crushed in a machine. However, in Transpavé the fine imposed was jointly recommended by the Crown and defendant. A joint submission was not presented in Metron and, in argument, the Crown had asked the court to impose a penalty of $1,000,000 - ten times more than was imposed on Transpavé - while Metron argued that the court should impose a fine of $100,000.

The court did not utilize the option available to it under the Criminal Code to place a corporation on probation and impose conditions. Amongst other powers, when imposing probation the court has the power to require a corporation to:

  • make restitution to a person for any loss or damage that they suffered as a result of the offence; and/or
  • provide information to the public, in the manner directed by the court, setting out the offence committed, the sentence imposed and any measures the corporation is taking to reduce the chance of a subsequent offence; and/or
  • comply with any other reasonable conditions to prevent the commission of subsequent offences or to remedy the harm caused by the offence.

Probation was not addressed during the sentencing submissions of the Crown or defence which made it less likely to be imposed. Candidly, all of the circumstances of the case - which includes its notoriety and pending civil claims filed against Metron - may have minimized the utility of a probation order.

Beyond its quantum, the sentence is interesting because the court sentenced Metron for the death of the Site Supervisor and the others killed in the accident. This is interesting because the Site Supervisor and Metron were treated as one for the purpose of finding Metron guilty of criminal negligence: the Site Supervisor's conduct was the conduct of Metron. However, for sentencing purposes, the Site Supervisor was considered a victim of Metron's criminal negligence. As such, the decision in Metron suggests that not only can the senior officer impute criminal liability to an organization, if that senior officer is injured or killed as a result of their conduct, the organization will be sentenced for that death or injury the same as for any other victim. Consequently, organizations should take note that they may be sentenced for all harm resulting from a criminal negligence conviction notwithstanding that the perpetrator of the criminal negligence is among the victims.

c) Sentencing Principles Under the Criminal Code - Corporations

The Criminal Code sets no minimum or maximum penalty when a corporation is convicted of criminal negligence causing death, meaning there is no limit on the amount of the fine that may be imposed on a corporate defendant. That said, the Criminal Code does require that the sentence imposed be proportional to the gravity of the offence and the culpability or blameworthiness of the defendant. As well, a sentence is to adhere to the principle of parity such that similar sentences are imposed on defendants convicted of similar offences in similar circumstances.

In order to guide a court in sentencing corporate defendants, the amendments to the Criminal Code made by Bill C-45 also augmented the sentencing factors to be considered by a court. In addition to the principles noted above, the Criminal Code requires a court to consider factors that are specific to corporate defendants including:

  • any advantage realized by the organization as a result of the offence;
  • the degree of planning involved in carrying out the offence and the duration and complexity of the offence;
  • whether the organization has attempted to conceal its assets, or convert them, in order to show that it is not able to pay a fine or make restitution;
  • the impact that the sentence would have on the economic viability of the organization and the continued employment of its employees;
  • the cost to public authorities of the investigation and prosecution of the offence;
  • any regulatory penalty imposed on the organization or one of its representatives in respect of the conduct that formed the basis of the offence;
  • whether the organization was €" or any of its representatives who were involved in the commission of the offence were €" convicted of a similar offence or sanctioned by a regulatory body for similar conduct; and
  • any measures that the organization has taken to reduce the likelihood of it committing a subsequent offence.

In this way, the Criminal Code has a fl exible set of sentencing criteria designed to guide a court without suggesting or prescribing the amount or nature of the penalty to be imposed.

In Metron, the court applied these factors as follows:

  • Advantage: Although Metron had been offered a $50,000 bonus for the completion of work by December 29th, there was no evidence that the bonus was related to the incident and therefore, there was no advantage realized by Metron as a result of the offence.
  • Planning and Complexity: The court found no evidence of planning or complexity. It accepted that the accident resulted from a momentary lapse of judgment because there was no evidence that the swing stage had previously been used by more than two workers, that workers had previously not used safety lines, or that workers had used intoxicants before using the swing stage. However, the court noted that Metron had contravened health and safety regulations for almost two months because the company operated the swing stage without a manual, instructions or other production information, and despite the fact that the swing stage did not have any marking, serial number or labels about maximum capacity. The court found this to be an aggravating factor to be considered in sentencing.
  • Conversion/Concealment of Assets: The court heard evidence and argument from the Crown that Metron was attempting to resurrect its business through a related corporation of which Metron's president was the president and sole director, but concluded the evidence fell short of establishing that Metron was attempting to conceal or convert its assets.
  • Cost to Public Authorities: Metron's guilty plea had signifi cantly reduced the cost of prosecuting the offence.
  • Regulatory Penalties: The court considered that Metron's president had been sentenced to a $90,000 fine under the OHSA.
  • Prior Offences or Sanctions: Neither Metron nor its representatives had any prior convictions or sanctions for similar conduct.
  • Company Penalties: Metron did not impose a penalty on any representative for the offence.
  • Economic Viability: This was one of the most important factors in the sentencing. The court heard evidence that a significant fine could drive the company into insolvency. In particular, the court heard that the company operated at a loss in 2010 and 2011, had substantial but unspecified amounts of debt, was owed substantial unpaid and potentially uncollectable accounts receivable, and was involved in litigation that could have financial consequences. The court noted that the economic viability of Metron was impossible to accurately predict, but concluded that imposing the $1,000,000 fi ne requested by the Crown would likely result in bankruptcy and would violate the Criminal Code requirement to consider the defendant's ability to pay. The court noted, however, that the company had a long history of success and may yet survive its precarious financial circumstances and took particular note of the fact that the company could apply for an extension of time to pay the fine if the company was unable to pay the fine within the time required.

It was after considering all of these factors that the court determined that a fine of $200,000 was appropriate. The court noted that the $342,500 in fines and surcharges payable by Metron and its president, which amounted to three times Metron's net earnings in its last profitable year (the year before the accident), would send a clear message to all businesses of the overwhelming importance of ensuring worker safety.

d) Comparison to Sentencing for Corporate Manslaughter in the United Kingdom

Sentencing corporations under the Criminal Code can be contrasted with the approach to sentencing for violations of the Corporate Manslaughter and Corporate Homicide Act 20079("Corporate Manslaughter Act") in the United Kingdom. After that Act was passed, a sentencing guideline10 was created, which set out the factors to be considered by a court when sentencing a corporation in circumstances where one or more persons have been killed as a result of an offence. While many of the factors set out in the guideline are consistent with the factors the Criminal Code requires a court to consider, the guideline contains more prescriptive commentary. In fact, with reference to sentencing a corporation convicted of corporate manslaughter, the guideline.

Footnotes

1 As required by the Criminal Code, a fi fteen percent surcharge, totalling $30,000 was imposed in addition to the fine.

2 Pursuant to the Provincial Offences Act, a twenty-fi ve percent Victim Fine Surcharge, totalling $22,500, was added to this amount.

3 "A representative who plays an important role in the establishment of an organization's policies or is responsible for managing an important aspect of the organization's activities and, in the case of a body corporate, includes a director, its chief executive officer and its chief financial officer", Criminal Code, R.S.C. 1985, c. C-46, s.2.

4 A Preliminary Inquiry into the criminal negligence charges against the Project Manager began on May 7, 2012, and concluded at the end of June. In late July a date will be set for submissions from the Crown and defence. It is anticipated that those submissions will be heard in October 2012.

5 Now the Infrastructure Health and Safety Association.

6 The agreed facts indicate that, if the swing stage had been properly designed by the manufacturer, it would have had a safety factor of 4:1 meaning that it should be able to hold 4,000 pounds. The weight of the six men and equipment would have been well below this limit.

7 R. v. Bosiljcic (unreported, January 28, 1993, Ont. Ct. (Prov. Div.), Milton, Sclisizzi J.P.). In addition to the fi ne the individual was also sentenced to six months in jail. The convictions followed a trial that the defendant did not attend and the court found that there was blatant disregard for the provisions of the OHSA.

8 R. v. Fantini, [2005] O.J. No. 2361 (QL)(C.J.).

9 2007 Chapter 19. The act created a new offence - known as corporate homicide in Scotland and corporate manslaughter in England, Wales and Northern Ireland - that is committed if the way in which an organization's activities are managed or organized causes a person's death and amounts to a gross breach of a relevant duty of care owed by the organization to the deceased.

10 Corporate Manslaughter & Health and Safety Offences Causing Death, Defi nitive Guideline, Sentencing Guidelines Council, February 2010. http://sentencingcouncil.judiciary.gov.uk/docs/ web__guideline_on_corporate_manslaughter_accessible.pdf

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