When Is An Employer Criminally Liable For The Actions Or Inactions Of Its Employee? | Independent Newspapers Limited
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When Is An Employer Criminally Liable For The Actions Or Inactions Of Its Employee?

Posted: Jul 23, 2015 at 12:00 am   /   by   /   comments (0)

In the past, it was inconceivable that a company could be held criminally liable. The argument generally advanced then was that a company, as an artificial person, has no physical existence and could therefore not be subjected to consequences attached to crimes. Following the development of commerce and the law, there were those who felt that a corporation has all the attributes of a natural person and should therefore be capable of receiving all the punishments attached to crimes. At present, companies are now criminally liable with the exception of certain offences like assault, manslaughter, murder, and rape.

Corporate crimes are illegal acts, omissions or commissions by corporate organisations themselves as social or legal entities or by their officials or employees acting in accordance with the corporate goals or standards, especially when such act, omissions or commissions are intended to benefit the corporations themselves. The imposition of criminal liability is a means of further regulating companies. There are also civil law remedies such as injunction and the award of damages which may include a penal element. Generally, criminal sanctions include imprisonment, fines, etc. A company has no physical existence, so it can only act vicariously through the agency of the human beings it employs.

Therefore, corporations have been vicariously and criminally held liable for the acts of such junior employees as drivers, clerks or cashiers. This is done through either the law of agency or labour law which makes the principal liable for the act of its agent and the master liable for the act of its servant. Also, in offences that require the proof of intent, corporations are easily made liable by imputing the state of mind of the directors who are the alter ego and directing minds of the corporation.

While corporate veils were lifted or pierced in the past to determine liability in civil matters, it is now clear that such conduct as pollution, tax evasion, production of harmful drugs and offences against other regulatory laws attract corporate criminal liability. The emerging scenario is one in which the legislature seeks to uncover the offending corporation, and at the same time disposed to subjecting such corporation to more severe punishment than fine. Today’s statutes now impose criminal liability on both the individual corporate officer and the corporate body.

One main ingredient of criminal liability is intent. Since a corporation has no physical existence of its own let alone a mind of its own, it could not be criminally liable. Corporate criminal liability became very pronounced with the introduction of strict liability offences. These are offences for which intent is not required for their commission.

Crimes created by statute are usually strict in nature. They do not require the proof of intention, recklessness, knowledge or even negligence. All that is needed is a proof that the offence was committed. Statutory offences are usually strict.

In Inspector General of Police v. Mandilas & Karaberis, the court jointly held liable the company and its manager for the offence of stealing. In its judgment, the court relied on the general principle that a corporation  acts through its agents and that once such agents act within the scope of their employment, the principal, which is the corporation, would be vicariously and criminally liable. In other words, a corporation should only be held criminally liable for conduct authorised, performed, or recklessly tolerated by its board of directors or by a high managerial agent acting on behalf of the corporation within the scope of his office or employment.

In Police v Adamu Yahaya, the court held that once a vehicle is being used to carry smuggled goods, the intention of the owner is immaterial because the statute regulating custom and excise is a strict liability one. In Nigeria, statutes have been specifically enacted in addition to the Nigerian criminal and penal codes which have provisions for corporate criminal liability. Such statutes include the Food and Drug Act, Standard Organisation of Nigeria Act, Weight and Measures Act, Companies and Allied Matters Act, Consumer Protection Council Act, Federal Environmental Protection Agency Act, Environmental and Sanitation Edict and a host of other statutes.

In Ogbuagu v Police, the appellant was the proprietor and publisher of a newspaper in Jos, Platue State. When leaving Jos, he instructed the man he left in charge not to make any publication using the newspaper while he was away. The man, however, made publications using the newspaper, which contained a seditious libel in one issue. In allowing the appeal against conviction by the lower court, the Appeal Court stated that when the proprietor tells the servant not to publish the paper, it cannot see why the proprietor should be answerable for an issue of a paper published by a disobedient servant. Here the court refused to impute the state of mind of the employee to the proprietor of the newspaper.   In R v African Press, a case with nearly the same facts as Ogbuagu’s,  the article was written by and under the responsibility of the editor and the court held both the defendant company and the editor jointly liable since the article was written by and under the responsibility of the editor.