Vehicle forfeiture: A problem for employers? | In Principle

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Vehicle forfeiture: A problem for employers?

On 7 February 2022, the Polish Sejm adopted an amendment to the Criminal Code introducing a controversial proposal for ordering the forfeiture of vehicles driven by intoxicated traffic offenders. Ordered by the criminal court, the change of ownership from the driver to the State Treasury is intended to help the justice system effectively combat road hogs and drunk drivers. The amendment is currently being considered by the Senate, which can still make changes. But it can already be predicted that rulings on vehicle forfeitures will face difficulties.

It has been argued that this measure will constitute another disproportionate sanction, alongside imprisonment, fines and compensatory measures. Additionally, the effectiveness of its application will largely depend on the efficient operation of law enforcement agencies and courts, as well as cooperation with vehicle owners, such as drivers’ employers, who may be subject to numerous procedural obligations.

The scale of the problem

If these regulations come into force, the courts in Poland will have a broad ability to order the forfeiture of vehicles or their monetary equivalent to the State Treasury. The application of these measures will depend on various factors. First and foremost, these include the type of offence committed by the driver, as well as the degree of intoxication with alcohol or drugs established by the civilian or military police. Primarily, the courts will have to award forfeitures in the case of “traffic recidivism,” a term used to refer to operation of a vehicle by an intoxicated driver who has previously been validly convicted of causing a traffic disaster, the threat of such an event, or a traffic accident even unintentionally while intoxicated, or when subject to a ban on driving. With traffic recidivism, the driver’s blood alcohol level will not matter. The forfeiture will also be mandatory if in a roadside check, the police determine that the driver is operating a vehicle with a blood alcohol content of .15% or more.

The number of cases in which it will be necessary to consider ruling on these measures could potentially be enormous. In 2021 alone, more than 44,000 persons, or nearly 14% of all people tried in district courts in Poland, were tried under Criminal Code Art. 178a §1 (driving while intoxicated with alcohol or drugs) by the courts of first instance. The scale of potential court proceedings in which the new provisions will be applied will certainly help to shape the practice, including in cases where physical seizure of vehicles by the State Treasury will serve no purpose and it will be necessary to order offenders to pay the monetary equivalent instead, or not impose such a measure at all.

Physical forfeiture or payment?

The principle promoted by the legislation passed by the Sejm is to be a ruling on vehicle forfeiture, i.e. ordering transfer of physical ownership of the vehicle to the State Treasury. But the amendment provides for exceptions. First, the court will be able to waive the forfeiture in “an exceptional case justified by special circumstances.” However, the drafters do not explain which situations will be covered by this exemption. Second, the amendment provides that in certain situations related to the legal status and physical state of the vehicle, the court will order payment of the monetary equivalent of the vehicle to the State Treasury. Third, in the case of drivers operating “a motor vehicle not constituting their property while performing professional or business activities consisting in driving the vehicle for an employer,” the court will order not forfeiture, but payment of exemplary damages of at least PLN 5,000 to the Fund for Victims’ Aid and Post-Penitentiary Assistance. Due to these exemptions, these solutions may raise legitimate questions.

Exceptions to the rule, or a gaping loophole?

The obligation to pay a monetary equivalent in lieu of physical forfeiture will arise first when due to the disposal, loss, destruction or significant damage to the vehicle, forfeiture would be pointless, economically unjustified or impossible (for example if the vehicle has been removed from Poland). This proposal may be considered reasonable, as seizing vehicles can cause unnecessary difficulties for police and prosecutors, such as the need to store wrecks. Another exemption from forfeiture is due to the legal status of the vehicle. Payment of a cash equivalent would be ordered when the offender is driving someone else’s vehicle. On the other hand, the last exemption applies to a situation where the offence is committed using a vehicle not belonging to the driver, but driven “as part of performance of professional or business activities involving driving for an employer.” Then exemplary damages are to be awarded.

The last of these exemptions is of particular concern, as it might favour certain perpetrators. During the work in parliament, the proponents assured that the provision will apply only to professional drivers (of trucks, buses, cabs, private vehicles, or public transit). However, it cannot be ruled out that other perpetrators will assert a line of defence attempting to show that the offence was committed in the course of performing activities for the purposes of an employer, and that their work performance was inherently connected with driving vehicles (e.g. transporting promotional materials or goods, or traveling to meetings with counterparties). Then the courts will have to consider thorough evidence to establish the nature of the journey during which the driver’s intoxication was established.

What is in store for employers?

Introducing the possibility of avoiding forfeiture in connection with performing activities linked to employment will also result in a number of consequences for employers. They may become some of the main stakeholders in the application of these provisions in practice. As owners, renters or lessees of vehicles, they will be in the spotlight of the police and courts as sources of information about the vehicle and the driver. In the amendment, the use of the term “employer” will not be relevant in this regard. According to the drafters, the regulation is intended to apply to all employment relationships, including those not based on an employment contract, and therefore also B2B contracts, contracts of mandate, or task-for-fee contracts. Therefore, any “employer” might become the target of orders, in particular obliging them to cooperate with the judicial authorities under the pain of penalties insuring compliance.

Employers who entrust their employees or associates with motor vehicles in good faith must take into consideration their potential temporary seizure by the police for up to seven days. It is the intention of the proponents that during this time, the police should establish the relevant circumstances regarding the possibility of providing security or ruling on forfeiture. Then, the circumstances related not only to the ownership status, but also the value of the vehicle reflected in the insurance policy, should be established. The latter circumstance will also be important for another reason. Probably, based on this information, the police and prosecutor will attempt to identify the suspect’s other assets, against which security can be ordered to cover the obligation to pay the monetary equivalent of the vehicle.

Additionally, law enforcement agencies and courts will be obliged to take steps to ascertain any circumstances related to the legal or factual relationship between the owner and the driver (e.g. the nature of the contract and activities provided by the driver to the vehicle owner). Also, it cannot be ruled out that employers who are former owners of vehicles will be asked for historical information (e.g. the book value for which the employee bought out a leased car, the condition of the vehicle and the investments made in it). Therefore, employers must expect requests to turn over documents relating not only to the vehicle (e.g. lease agreement), but also employee records, such as employment contracts, scope of duties, lending agreements, vehicle policies, and financial documents showing the legal relationships between them and their drivers.

Therefore, the regulations require law enforcement agencies to act efficiently and promptly. On the other hand, drivers’ employers will not avoid the inconvenience of these actions, and should rather think about minimising the possible inconvenience. In particular, they may consider introducing mechanisms in vehicle policies for responding to calls from the police, for example by designating a person responsible for such contacts (such as an HR officer or logistics manager). They may also consider requiring employees to report detentions for offences committed for which a vehicle forfeiture may be ordered. However, the effectiveness of such a solution may be questionable, as in practice it could mean an obligation of self-denunciation that could potentially result in disciplinary termination of the employment contract.

Deferred entry into force

According to the drafters, the proposed changes would not take effect immediately, which may come as a big surprise. In this case, a one-year grace period is provided for, rarely seen in recent years for criminal legislation. This raises another question: whether the Ministry of Justice plans to make proper use of this period and take action to raise awareness of the reasons for the changes. Social awareness, not complex and hard-to-apply rules, could best achieve the goal set by this amendment, to improve road safety.

This article originally appeared in Dziennik Gazeta Prawna

Dr Artur Pietryka, Business Crime practice, Wardyński & Partners