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Sub-contractors’ errors – who is responsible?

Text Box: John Cox and Peter Speller comment on the recent civil case on the 1996 explosion at Albright & Wilson’s Avonmouth plant

On 3rd October 1996, a tanker containing a 25% solution of sodium chlorite arrived at the Avonmouth works of Albright & Wilson (A&W). After admission at the weighbridge it was checked by a chemist and directed to the epichlorohydrin storage area.

Soon after, a series of explosions destroyed the storage tank and the road tanker and started a fire, which persisted for an hour. The fire generated a 100m black plume of smoke containing hydrogen chloride, which drifted across the Severn estuary closing local motorways and rail services.

The events that led to the explosion are not in dispute.

In September, A&W purchased sodium chlorite solution from Berk Limited who, for their part, sourced from Caffaro in Italy, who engaged Huktra NV, a Belgian haulage company. Caffaro loaded the consignment into a Huktra ‘swap body’ tanker numbered HUKU 302012-8 and labelled appropriately for chlorite solution. It travelled by truck, train and ferry to Purfleet with its supporting documentation in its document tube (fixed to the swap body).

About the same time, A&W had placed a blanket order for four consignments of epichlorohydrin from Biachem Limited.  Biachem sourced the material from Spolek in the Czech republic and also engaged Huktra.

Spolek loaded two Huktra tankers for the journey to Avonmouth – the first being numbered HUKU 302041-0 and correctly labelled and documented (for epichlorohydrin).

Huktra sub-contracted the delivery of both materials from Purfleet to Avonmouth to Stevens Transport, who collected the tankers for the final leg.  Normally the instructions to the driver are clear from the documents kept in the ‘document tube’ attached with the tanker.  However, during this journey Biachem had faxed a ‘delivery note’ to Huktra for presentation at Avonmouth with the epichlorohydrin delivery.  This delivery note initiated the chain of events that culminated in the explosion.

Huktra, unfortunately, misinterpreted Biachem’s wishes and faxed instructions to Stevens to replace all original documents with this new delivery note.  Whilst this on its own should not have caused a problem, they also, in error, wrote HUKU 302012-8 (the number for the Berk delivery) on the new delivery note.

Following these instructions, the Stevens driver collected tanker HUKU 302012-8 and, on arrival at Avonmouth, presented the Biachem delivery note (for epichlorohydrin).  This was accepted at face value and A&W’s written procedures did not include any checks that could have revealed the documentation error.  The first warning of the situation was a ‘phone call from Huktra who had just discovered their mistake – but by then, off-loading was well under way(1).

criminal prosecution

Following the explosion, the Health & Safety Executive sought to prosecute A&W, Huktra and Biachem under the Health & Safety at Work Act.  A&W and Huktra both pleaded guilty.  His Honour Judge Bursell QC rejected the prosecution’s submission (against Biachem), accepting that Biachem were not responsible for the documentation error(2).

Text Box: R v Associated Octel Ltd
R v Associated Octel Ltd (1996) arose from an incident in 1990. An employee of a subcontractor at Octel’s Ellesmere Port premises caused a fire whilst repairing the lining of a resin tank. At issue was whether Octel were in a position to “control” how the work of their subcontractor was conducted. The Lords of Appeal ruled that “the employer must take reasonable practical steps to avoid risk to the contractors’ servants which arise … from the inadequacy of the arrangements which the employer make with the contractors for how they will do the work.” The judgement made Octel liable for the actions of their subcontractor even though, on this occasion, they were unaware that the practices being conducted by their sub-contractor differed from the authorised method statement.
This was a significant judgement. It allayed fears from R v Associated Octel Co Ltd(3) that companies had become automatically liable for the actions of their sub-contractors.    It “showed a reluctance to take Octel further than was intended by holding an employer responsible for the acts of independent contractors regardless of the nature of those activities”(4) (Claire McNamara, Hazardous Substances, June 1999) - welcome news for those who feared that Octel made companies responsible for events wholly outside their control.

safety issues

The HSE, subsequently, has focused on what a receiver should do to prevent a similar occurrence.  This accords with the views of safety professionals(5), as reported in tce in November and December 1996.  The HSE identified the following as key lessons to be learned and examined when considering receipt of materials from road tankers:

Failings in Technical Measures (from the HSE Case Study notes(6))

  No preventative measures were in place to safeguard against the addition of a material, reactive with the substance in the storage tank (in this case epichlorohydrin).

  The documentation carried with the driver was not checked against the original quality documentation (e.g. for tank number) and the hazard markings on the tanker were not checked.

These highlight the fact that, in addition to forming part of quality and commercial systems, the procedures for identification of material delivered in road tankers and ensuring its unloading into the correct storage tank form part of a safety system which should be examined with the same degree of rigour as any other.

As stated during the HSE prosecution in 1999, “It is a matter of disbelief that the load got through.(7)  The tanker displayed a “corrosive” hazard symbol and the codes for chlorite solutions (ADR “80”, UN “1908”) – yet those on duty at the gatehouse, in the laboratory and at the plant, who (unlike the tanker driver) were familiar with both chlorite solutions and epichlorohydrin were not required to and did not check whether these were consistent with an epichlorohydrin delivery.

Also, having recently discontinued sampling and analysis, the residual quality control procedures did not require the incoming tanker number to match the number on the Certificate of Analysis!  Any of these checks would have alerted A&W to Huktra’s documentation error and could have prevented the explosion.

Immediately after the event, A&W instituted measures to check tank numbers, labels and placards – exactly as had been suggested by the Laboratory Superintendent after an incident in 1989. Given that the ALARP principle dictates that all “reasonable and practicable” measures that reduce risk should be implemented, it is clear that A&W share some “blame” for the explosion.

A&W and Huktra were found guilty of offences under the Health and Safety at Work Act, and fined 60,000 ($110,000) and 15,000 respectively.  The cost of the damage to the Avonmouth Plant exceeded 10million.

civil prosecution

HSE’s focus on the shortcomings of the raw materials acceptance procedures contrasts with the prosecution subsequently pursued by A&W (actually Rhodia – who by then had acquired the Avonmouth site).  The civil claim relied on the contractual failing of Berk(!) to deliver the right documentation with the sodium chlorite solution.  As Berk had no direct control over the actions of Huktra or Stevens, this claim revives the spectre of Octel and could have far-reaching implications for industry.

Why the civil claim ignored “blame” (in the sense of “what might have been done to prevent the incident”), is explained in a preliminary judgement of Lord Nicholls(8) in the House of Lords:

“Had Albright & Wilson advanced claims in negligence ... no doubt it would have been met with a plea that Albright & Wilson was itself guilty of contributory negligence when its employees at Avonmouth directed the tanker containing sodium chlorite to the tanks where the epichlorohydrin was stored.  In order to avoid any such plea of contributory negligence being raised Albright & Wilson has advanced its claims ... solely on the basis of loss arising from breach of contract.  It has eschewed a claim based on a failure to exercise care, either in tort or contract”.

For the civil claim, the House of Lords ruled that the contract between Berk (the suppliers of sodium chlorite) and A&W was being executed - making Berk the target defendant.  In response, Berk argued that A&W had not fulfilled a contractual obligation to discharge their consignment to the correct storage vessel.

natural justice

"Natural justice" (as opposed to the law of contract) requires that "the punishment must fit the crime." It is not clear what crime Berk committed.  Their contractual arrangements with A&W were undermined by the actions of parties over which they had effectively no control: it was not they who had introduced a delivery Text Box: Peter Speller and John Cox are Partners in Cox & Speller (www.cox-and-speller.com). Peter is a member of the editorial board of IChemE’s Loss Prevention Bulletin: John is an IChemE Registered Safety Professional who appeared as an expert witness during the recent civil proceedings.

note for another company which became associated with their load.  It is ironic that the same events that seemed to limit the applicability of Octel (through the failure of the HSE to secure prosecution against Biachem) has raised an even greater concern - that companies could be held liable for the actions of others with whom they have only the most tenuous contractual relationships.

A&W eventually agreed a settlement (details of which remain confidential) but, by instigating their civil claim, revived the spectre of Octel and diverted attention away from the lessons of the HSE prosecution.

What the chemical industry needs to do is concentrate on the implementation of the lessons learned – as published in the Chemical Industry Associations "Procedures for offloading products into bulk storage at plants and terminals” ISBN 1-85897-087-3 - to prevent the recurrence of similar incidents. As in most walks of life, prevention is better than the legal remedy. Moreover, in an ideal world, a party found guilty of negligence by a Health & Safety prosecution would be debarred from claiming against innocent parties – and the huge sums of money spent on legal technicalities would not have been wasted.

 

References

  1. http://www.hse.gov.uk/comah/sragtech/casealbright96.htm
  2. "Section 3(1) Health and Safety at Work Act 1974: The activities of an independent contractor", Claire McNamara writing in Hazardous Substances, June 1999
  3. http://www.parliament.the-stationery-office.co.uk/pa/ld199697/ldjudgmt/jd961114/octel01.htm
  4. Ibid
  5. Trevor Kletz, TCE 28 Nov 96; Jim Kowszun 12 Dec9
  6. HSE case study notes: http://www.hse.gov.uk/comah/sragtech/casealbright96.ht
  7. Mr Carlisle, appearing for The Crown, statement to HSE prosecution 25th May 1999
  8. http://www.parliament.the-stationery-office.co.uk/pa/ld200102/ldjudgmt/jd021017/albrig-1.htm

tce    october 2004