A recent English Queen’s Bench Division case (Stody Estate Limited -v- Secretary of State for Environment, Food and Rural Affairs) provides some useful clarification on the issue of who is liable when cross compliance breaches occur.
Stody concerned an estate in Norfolk. The estate had been farmed by the MacNicol family for around 75 years. The case report notes that there were around 16 full time employees on the estate. In the usual way, Stody Estate Limited claimed agricultural support payments. One of the estate gamekeepers was arrested on suspicion of poisoning raptors. He was subsequently convicted under the Wildlife Conservation Act 1981. The gamekeeper’s role on the estate was multi-faceted, covering estate security, animal and fowl husbandry, vermin control, and so on. The gamekeeper had been employed on the estate for over 20 years.
Rural Payments Agency
Following the gamekeeper’s conviction, the Rural Payments Agency notified Stody Estate Limited that it was to be held “vicariously liable” for the gamekeeper’s actions in killing the wild birds, which amounted to a cross compliance breach. They imposed a 75% payment reduction for all support payments in the year of the gamekeeper’s conviction.
Independent Agricultural Appeals Panel
The matter was then referred, by Stody Estate Limited, to the Independent Agricultural Appeals Panel (who have equivalent jurisdiction in England to the Scottish Land Court in Scotland). The Panel found that vicarious liability did not in fact apply but, nevertheless, they considered some payment reduction was appropriate, and recommended a 20% payment reduction, in place of the 75% reduction that had been initially proposed by the RPA. The matter then went to the Secretary of State who made the decision that the payment reduction should be 55%, and not 75% by reason of “the extent to which the Estate took reasonable steps to prevent non-compliance and its approach to environmental issues”.
The case then made its way to the Queen’s Bench, and the legal point was whether there was any scope at all for Stody Estate Limited to be liable for things done by employees – i.e. does vicarious liability apply?
The court held that Stody Estate Limited could not be found liable for the crimes of the employee, on the basis that the actions of the employee were not “directly attributable” to Stody Estate Limited as the claimant of the support payments.
This is good news for support payment claimants who find themselves in a position where, through no fault of their own, a cross compliance breach has occurred. The judgement clarified that there may be circumstances, however, where the employer could be held liable for the actions of an employee, as follows:-
“Obvious examples of circumstances in which poisoning wild birds might be said to be “directly attributable” to the [support payment claimant] are:- a positive instruction/encouragement given by the farmer (if a natural person) or farm manager (if a company) to an employee to kill the birds, a failure to provide reasonable instruction or training, or a failure to take steps to end activity upon becoming aware of killings taking place”.