Intentional, reckless and criminally negligent: when can an employee’s state of mind be taken for that of the company?

31 January 2020


Wollondilly Abattoirs (First Respondent) had pleaded guilty to six offences in relation to supplying false or misleading information in a material respect under the Act. The General Manager of Wollondilly Abattoirs (Second Respondent), pleaded guilty to five offences under the special executive liability provisions of the Act. Both respondents were convicted by Pain J and ordered to pay costs. Before Pain J it was agreed that the Second Respondent had falsified reports without the knowledge of the directors of the company.

In relation to the First Respondent, the Environment Protection Authority (EPA) appealed the decision on the following grounds:

  1. Whether the sentencing judge erred in assessing the seriousness of the offences without reference to the state of the mind of the employees; and
  2. Whether the sentencing judge erred in failing to find that each of the offences were committed knowingly and deliberately by the defendant by reference to the state of mind of key employees.

Section 169C of the Act states:

  1. Without limiting any other law or practice regarding the admissibility of evidence, evidence that an officer, employee or agent of a corporation (while acting in his or her capacity as such) had, at any particular time, a particular state of mind, is evidence that the corporation had that state of mind; and
  2. In this section, the state of mind of a person includes—
    • the knowledge, intention, opinion, belief or purpose of the person; and
    • the person’s reasons for the intention, opinion, belief or purpose.

Who’s state of mind?

The CCA stated that the determinative question is whether a company, by its controlling mind, had the relevant state of mind to commit the offence. In his capacity as General Manager, the Second Respondent could not be said to have control of the company, his actions being outside of the ambit of his role and without the knowledge of the directors.

The CCA took the view that section 169C does no more than make evidence of the state of mind of a relevant individual some evidence of the state of mind of the corporation. It does not attribute the individual’s state of mind to the corporation.

The provision allows a prosecutor to adduce legally sufficient information of the company’s state of mind by relying on the evidence of a relevant individual, but where there is other evidence, all evidence must be taken to determine the state of mind of the corporation. In the present case, the evidence as a whole pointed to the fact that the controlling mind was not intentional, reckless nor criminally negligent, being distinct from the mind of the Second Respondent.

The CCA therefore dismissed the appeal by the EPA.

This article was written by Paul Lalich, Partner, Andrew Scully, Senior Associate and Jonathan Daniel, Law Graduate.

Subscribe to HWL Ebsworth Publications and Events

HWL Ebsworth regularly publishes articles and newsletters to keep our clients up to date on the latest legal developments and what this means for your business.

To receive these updates via email, please complete the subscription form and indicate which areas of law you would like to receive information on.

Contact us