Last week, the first corporate ­prosecution under the much-heralded Corporate Manslaughter and Corporate Homicide Act 2007 ended with a fine of £385,000 against Cotswold Geotechnical Holdings.

This followed its conviction for ­corporate manslaughter at Winchester Crown Court two days earlier.

The Crown Prosecution Service has said that it is considering other cases which may lead to proceedings.

It is sincerely to be hoped that such cases are not in the mould of Cotswold Geotechnical, otherwise the new act will have begun not with a bang, but with a whimper.

When the draft bill was introduced in March 2005, following the Law Commission’s 1996 report which proposed the reform, a major claim made on behalf of what ultimately became the 2007 act was that it would be ‘P&O proof’.

In other words, if the Zeebrugge ferry disaster or something similar were to recur, the company would be convicted of the proposed new offence.

The perceived problem with the old law (and the reason behind the abandonment of the prosecution of P&O) was the so-called ‘identification principle’, which in the context of corporate manslaughter meant that, before a company could be convicted of manslaughter, a ‘directing mind’ – an individual or individuals at the top of the corporate hierarchy – had to be found guilty of manslaughter first.

The new law departed significantly from the Law Commission’s proposals by requiring a ‘substantial element’ of the breach of duty that consists in the offence to be ‘the way its activities are managed or organised by senior management’.

Such senior management are then defined as those who play significant roles in making decisions about how the company’s activities are organised, or those who actually manage or organise those activities.

It scarcely needs to be said that terms such as ‘substantial element’, ‘senior management’, and ‘significant role’, arguably diminish the act’s intended departure from the identification ­principle.

The CPS has resisted overplaying the significance of the Cotswold Geotechnical conviction in the context of prosecution for corporate manslaughter as a whole, and rightly so.

The nature of that case is such that it unfortunately tells us nothing whatsoever about how these new principles operate. Cotswold Geotechnical is a company employing just eight individuals.

Its director was both in overall control of the way the company managed its affairs and present on site shortly before the tragic accident happened.

As such these facts bear a startling resemblance to the first conviction of a company for manslaughter under the old law, in December 1994.

Kite and OLL Ltd, a ‘one-man band’ company, was convicted at Winchester Crown Court following the conviction of its managing director and sole owner, Mr Kite.

While Mr Eaton, the director of Cotswold Geotechnical, was originally charged with manslaughter, those charges were stayed after he was ruled unfit to stand trial.

Notwith­standing that, it appears that a prosecution of Cotswold Geotechnical might have been just as successful under the old law.

The true test of the new legislation will come with a prosecution of a large company which has multiple directors and which already purports to have compliant health and safety procedures.

Not only will such companies have greater resources at their disposal to fight any such prosecution, they will already have invested substantial time and money in health and safety compliance, and in consequence will be much better placed to argue that the accident – whatever it might be – was indeed a tragic accident which did not arise out of a relevant breach of the company’s.

If the Cotswold Geotechnical conviction is to be a historical footnote then it is as a sentencing guide rather than a guide to a successful prosecution.

The fine imposed, to be paid over 10 years, was substantially more than the reported annual turnover of the company, said to be in a ‘parlous financial state’.

Even so, the fine is below the recommended starting point of £500,000 set by the Sentencing Guidelines Council (SGC).

The SGC had recommended that too much of a fixed correlation between turnover and fine as a percentage thereof could provide a perverse incentive to manipulation of corporate structure.

Having said that, the judge, in passing sentence, remarked that if the fine caused the company to go into liquidation then that was an outcome ‘unfortunate but unavoidable’.

David McCluskey is a partner at Peters & Peters