Brumder v Motornet Service and Repairs Ltd & Anor

An employer’s absolute statutory liability for unsafe work equipment is qualified where the injured claimant’s own breach of duty is solely responsible for the employer’s non-compliance. The defence may apply where the claimant is the company’s sole director and shareholder, even though the director and company owe different duties.

A director who pays no attention to health and safety and makes no attempt to enable the company to meet its obligations breaches the duty of reasonable care, skill and diligence under section 174 of the Companies Act 2006. Such a director cannot recover from the company for harm caused by that wrongdoing. This conclusion respects the company’s separate legal personality and does not pierce the corporate veil.

The appellant was the sole director and shareholder of a vehicle-servicing company. His finger was severed when he attempted to descend from a raised hydraulic ramp after its compressor failed. The Brighton County Court held that the company had breached the absolute duty in regulation 5(1) of the Provision and Use of Work Equipment Regulations 1998, but dismissed the claim after finding the appellant 100% contributorily negligent.

It was common ground on appeal that a finding of 100% contributory negligence was wrong in principle once primary liability had been established. By a respondent’s notice, the company contended that the claim should nevertheless be dismissed because its breach was wholly caused by, and co-extensive with, the appellant’s own failure to discharge his responsibilities for health and safety. The central issue was whether the defence recognised in Ginty and Boyle applied where the claimant was the company’s sole director and the duties breached by the company and director were different.

1. Appeal dismissed and respondents’ notice upheld. The company was entitled to rely on the Ginty/Boyle defence, and the claim was dismissed, although for reasons different from those of the county court. Ward and Longmore LJJ agreed with Beatson LJ.
2. The employer’s obligation under regulation 5(1) of the Provision and Use of Work Equipment Regulations 1998 was absolute and continuing. Ordinarily, proof of non-compliance and resulting injury establishes a prima facie cause of action. The employer may nevertheless establish a defence by proving that it was without fault and that the claimant’s own wrongful act or omission was solely responsible for the non-compliance and injury. The defence is not confined to cases in which employer and employee breach the same statutory provision: [1959] 1 All ER 414 and [1969] 1 WLR 661 applied.
3. The appellant owed the company a duty under section 174 of the Companies Act 2006 to exercise reasonable care, skill and diligence concerning its statutory health and safety obligations. His total failure to address health and safety, arrange a risk assessment, or establish inspection and maintenance arrangements breached the objective minimum standard in section 174(2)(a). His lack of mechanical expertise did not excuse that failure.
4. As the sole director through whom the company could act, the appellant could not complain that the company had failed to prove that it did all it could to comply. His breach of his personal duty to the company caused the company’s breach of its distinct absolute duty. Permitting recovery would allow him to benefit from his own wrong and would produce circular litigation, since the company could in principle recover from him the damages payable because of his default.
5. This reasoning did not pierce the corporate veil. It recognised the company and director as separate persons owing different duties and reflected the director’s ability to act in distinct corporate and personal capacities. The result might differ where a director had taken reasonable steps to secure compliance. That question would be fact-sensitive, and delegation would not remove the continuing duty to guide, monitor and supervise delegated functions.
6. The trial judge was entitled to find that an appropriate risk assessment following the earlier ramp incident would have addressed the danger of a person becoming stranded at height and would have prevented the accident. It was therefore unnecessary to apportion responsibility under the Law Reform (Contributory Negligence) Act 1945. Had apportionment arisen, the appellant would have been predominantly to blame.

1. Court of Appeal (Civil Division): The appeal was dismissed. The respondents’ notice was upheld and the claim remained dismissed, although on grounds different from those adopted below: [2013] EWCA Civ 195.
2. Brighton County Court: His Honour Judge Levey found that the company had breached regulation 5(1) of the Provision and Use of Work Equipment Regulations 1998 and that the defect caused the accident. He nevertheless dismissed the claim on 12 June 2012 after finding the claimant 100% contributorily negligent.