Growthbuilt Pty Ltd v SafeWork NSW

Industrial Relations Commission (NSW)|2017-11-03

Solicitors: Clyde & Co (Applicant) Colleen Dreis General Counsel Department of Finance Services and Innovation (Respondent) File Number(s): 2017/206434

Judgment

By its Application the applicant sought an external review of a prohibition notice issued by Inspector Gavin Mann on 9 June 2017. In the alternative the applicant sought a review of the respondent's decision not to conduct an internal review of the prohibition notice.
At the commencement of the hearing, Mr Tooma, solicitor for the applicant, advised that the applicant moved only on the alternative application.

The legislation

The issue of a prohibition notice is authorised by s 195 of the Act which is in the following terms: 195 Power to issue prohibition notice (1) This section applies if an inspector reasonably believes that: (a) an activity is occurring at a workplace that involves or will involve a serious risk to the health or safety of a person emanating from an immediate or imminent exposure to a hazard, or (b) an activity may occur at a workplace that, if it occurs, will involve a serious risk to the health or safety of a person emanating from an immediate or imminent exposure to a hazard. (2) The inspector may give a person who has control over the activity a direction prohibiting the carrying on of the activity, or the carrying on of the activity in a specified way, until an inspector is satisfied that the matters that give or will give rise to the risk have been remedied. (3) The direction may be given orally, but must be confirmed by written notice (a prohibition notice) issued to the person as soon as practicable. (Emphasis added)
Section 223 of the Act makes the decision to issue a prohibition notice a reviewable decision. Section 224 of the Act authorises an internal review.
Section 226 of the Act deals with the decision on internal review in the following terms: 226 Decision of internal reviewer (1) The internal reviewer must review the reviewable decision and make a decision as soon as is reasonably practicable and within 14 days after the application for internal review is received. (2) The decision may be: (a) to confirm or vary the reviewable decision, or (b) to set aside the reviewable decision and substitute another decision that the internal reviewer considers appropriate. (3) If the internal reviewer seeks further information from the applicant, the 14-day period ceases to run until the applicant provides the information to the internal reviewer. (4) The applicant must provide the further information within the time (being not less than 7 days) specified by the internal reviewer in the request for information. (5) If the applicant does not provide the further information within the required time, the decision is taken to have been confirmed by the internal reviewer at the end of that time. (6) If the reviewable decision is not varied or set aside within the 14-day period, the decision is taken to have been confirmed by the internal reviewer. (Emphasis added)
Provision for external review is made by section 229 of the Act in the following terms: 229 Application for external review (1) An eligible person may apply to the Industrial Relations Commission for review (an external review) of: (a) a reviewable decision made by the regulator, or (b) a decision made, or taken to have been made, on an internal review. (2) The application must be made: (a) if the decision was to forfeit a thing (including a document), within 28 days after the day on which the decision first came to the applicant's notice, or (b) in the case of any other decision, within 14 days after the day on which the decision first came to the applicant's notice, or (c) if the regulator is required by the Industrial Relations Commission to give the eligible person a statement of reasons, within 14 days after the day on which the statement is provided. (3) The Industrial Relations Commission may stay the operation of a decision that is the subject of an external review pending a decision on the review. (4) The Industrial Relations Commission may, on an external review, confirm, vary or revoke the decision concerned. (Emphasis added)
I observe that s 226(6) indicates that a failure by the internal reviewer to make a decision, within the specified time, setting aside or varying the decision under review is taken to be a confirmation of that decision. As no decision was made I am satisfied, in accordance with s 229(1)(b) of the Act that the Commission has jurisdiction to entertain this review.
Further, I note the Commission's power on external review is to confirm, vary or revoke the decision concerned.
Of relevance also are the provisions of the Act dealing with notifiable incidents. They are so far as relevant: 35 What is a "notifiable incident" In this Act, notifiable incident means: (a) the death of a person, or (b) a serious injury or illness of a person, or (c) a dangerous incident. 37 What is a "dangerous incident" In this Part, a dangerous incident means an incident in relation to a workplace that exposes a worker or any other person to a serious risk to a person's health or safety emanating from an immediate or imminent exposure to: (a) an uncontrolled escape, spillage or leakage of a substance, or …. (f) the fall or release from a height of any plant, substance or thing, or … (h) the collapse or partial collapse of a structure, or (i) the collapse or failure of an excavation or of any shoring supporting an excavation, or … but does not include an incident of a prescribed kind. (Emphasis added) There do not appear to be any prescribed excluded incidents. 38 Duty to notify of notifiable incidents (1) A person who conducts a business or undertaking must ensure that the regulator is notified immediately after becoming aware that a notifiable incident arising out of the conduct of the business or undertaking has occurred. Maximum penalty: (a) in the case of an individual - $10,000, or (b) in the case of a body corporate - $50,000. (2) The notice must be given in accordance with this section and by the fastest possible means. … (Emphasis added)
Finally it is convenient to note the Object of the Act which is set out in s 3. The section provides: 3 Object (1) The main object of this Act is to provide for a balanced and nationally consistent framework to secure the health and safety of workers and workplaces by: (a) protecting workers and other persons against harm to their health, safety and welfare through the elimination or minimisation of risks arising from work or from specified types of substances or plant, and (b) providing for fair and effective workplace representation, consultation, co-operation and issue resolution in relation to work health and safety, and (c) encouraging unions and employer organisations to take a constructive role in promoting improvements in work health and safety practices, and assisting persons conducting businesses or undertakings and workers to achieve a healthier and safer working environment, and (d) promoting the provision of advice, information, education and training in relation to work health and safety, and (e) securing compliance with this Act through effective and appropriate compliance and enforcement measures, and (f) ensuring appropriate scrutiny and review of actions taken by persons exercising powers and performing functions under this Act, and (g) providing a framework for continuous improvement and progressively higher standards of work health and safety, and (h) maintaining and strengthening the national harmonisation of laws relating to work health and safety and to facilitate a consistent national approach to work health and safety in this jurisdiction. (2) In furthering subsection (1) (a), regard must be had to the principle that workers and other persons should be given the highest level of protection against harm to their health, safety and welfare from hazards and risks arising from work or from specified types of substances or plant as is reasonably practicable. (Emphasis added)

Issues

At the outset of his submissions Mr Magee accepted that SafeWork NSW should have completed the internal review. He submitted its decision not to complete the review was bad at law. The fact that the Prohibition Notice had been complied with did not render the decision non-reviewable. He confirmed that SafeWork NSW had no such policy in place and the views expressed in the correspondence were mistaken.
That concession meant that the external review must succeed. The next question is what should follow from that outcome? The possibility of remittal was raised but not pressed by either party. The consensus was that the Commission should review the original decision of the Inspector. This is not the occasion on which to consider whether remittal is an order the Commission can make although it would appear, at first glance, inconsistent with s 229(4) of the Act.
In his written outline Mr Magee submitted: The extent of the Commission's power to conduct a review under s.229 of the WHS Act, has been the subject of consideration by the Commission in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, NSW Branch) and WorkCover Authority of NSW [2012] NSWIRComm 143; NSW Rural Fire Service v SafeWork NSW [2016] NSWIRComm 4; and Sydney Trains v SafeWork NSW [2017] NSWIRComm 1009. The nature of a review pursuant to s.229 involves a merits review of the decision under review. [1] In other words, in this matter, the Commission is standing in the shoes of the decision maker, and determining whether the decision to issue the Notice should be confirmed, revoked or varied. The proceedings involve a merits review with the Commission required to determine the correct or preferable decision in respect to the initial decision by the Inspector to issue the Notice. The Commission may only exercise the powers that were available to the original decision maker.
In his oral submissions he drew attention to a difference of opinion between members of the Commission in NSW Rural Fire Service v SafeWork NSW [2016] NSWIRComm 4 and Sydney Trains v SafeWork NSW [2017] NSWIRComm 1009. In the former decision I expressed the view at [72] that the reasons for decision on the internal review were relevant and should be accorded appropriate weight. In the latter case Newall C expressed a contrary view at [22] - [26]. As there are no reasons for decision on the internal review in this case, the issue does not arise for consideration. Resolution of the difference will need to await another occasion.
Mr Tooma's submissions on the nature of the review accorded with Mr Magee's. The issue for determination as identified by both advocates, was whether the Inspector had a "reasonable belief" as required by s 195 (1) of the Act on which to base his decision to issue the Prohibition Notice.
Again, it was common ground that it is not a question of whether I, as external reviewer, would have formed that belief. Moreover, the question in this case is not whether the Inspector held a belief but whether such a belief was reasonable in the circumstances. Mr Tooma submitted that involved an objective test. Mr Magee submitted it was a subjective test. There were also conflicting submissions about the existence of a distinction between having a reasonable belief and having reasonable grounds to believe.

Submissions

Mr Tooma referred to the decision of Kaye J in the Victorian Supreme Court in Halley v Kershaw [2013] VSC 439 which concerned an appeal from a conviction for driving with a prescribed concentration of alcohol. It is unnecessary to recite the facts of the case in detail. The issue under consideration was whether the police officer had reasonable grounds to believe that the appellant was "in charge of a vehicle". His Honour distilled from earlier authorities a number of principles relating to the proof of the existence of "reasonable grounds for a belief". Kaye J at [41] wrote: The principles relating to the proof of those matters have been discussed in a number of authorities, and were recently helpfully compiled by Bell J in Director of Public Prosecutions v Farmer. [2] In particular, the following principles are relevant: (1) The informant should give specific evidence as to the belief which he or she formed in relation to the intention of the defendant to start or drive the vehicle. [3] (2) In addition, the informant should expressly state the basis upon which he or she formed that belief. [4] (3) It is not necessary that the informant be satisfied of the particular fact on the balance of probabilities; rather, the informant must establish that he or she held the belief on reasonable grounds. (4) Such a belief has been described as 'an inclination of the mind towards assenting to, rather than rejecting, a proposition …' [5] In DPP v Farmer, [6] Bell J stated that a 'belief is something more than suspicion but does not need to approach anything like certainty.' (5) The belief by the informant must be a belief that the defendant intended to '… start the engine or drive off forthwith, or to do so at any point of very close futurity'. [7] (6) The question is not whether the court itself holds, or agrees with, the belief that the defendant intended to drive or start the vehicle. Rather, the question is whether the informant held such a belief, and whether the informant did so on reasonable grounds. [8]
As to the application of these principles in the current matter Mr Tooma submitted: This matter related to a decision in relation to being in control of a motor vehicle, I believe under the influence, and the question ‑ the facts, as I recall them, were that the driver was in the vehicle and hunched over the driving wheel and the car was in park. And the conclusion was, in those circumstances, that the police officer could not have held the view reasonably that he attempted to drive that vehicle. That's relevant, we say, because that is exactly the factual circumstances that goes to matters such as the existence of the excavator, and the existence of the excavator in the basement of that work site which, the evidence is, that was used previously in relation to excavation work prior to 1 June '17, was then subsequently used as part of rectification work that was conducted in accordance with the engineer's instructions and, in accordance with the notice, would be permitted and permissible under the notice and therefore cannot form the basis of the reasonable belief which your Honour has to consider.
In Halley v Kershaw the police officer did not give evidence of his belief or of the reasons he formed that belief. Inspector Mann gave evidence as to both matters. A further point of distinction between the two cases is the time frames involved. In Halley v Kershaw it was a question of a few hours. In this case the period was measured in days. It is difficult to extrapolate from the result in Halley v Kershaw the conclusion Mr Tooma advanced. That is not to say that the propositions he makes are without merit, merely that they must be considered in the context of this case.
Mr Tooma then referred to the decision of the High Court in George v Rockett [1990] HCA 46; 170 CLR 104. In that case the Court was considering whether a search warrant had been validly issued in connection with a criminal prosecution. In deciding whether to issue the warrant the magistrate had to form a suspicion about one matter and a belief on reasonable grounds about another. The particular passage relied upon by the applicant, which is set out below, concerns the latter concept and follows consideration of what is necessary to support a suspicion. It is thus expressed in comparative terms. The Court said at p 116: The objective circumstances sufficient to show a reason to believe something need to point more clearly to the subject matter of the belief, but that is not to say that the objective circumstances must establish on the balance of probabilities that the subject matter in fact occurred or exists: the assent of belief is given on more slender evidence than proof. Belief is an inclination of the mind towards assenting to, rather than rejecting, a proposition and the grounds which can reasonably induce that inclination of the mind may, depending on the circumstances, leave something to surmise or conjecture.
The applicant conceded that the Inspector did not have to form his belief on the balance of probabilities. The submission was then directed to the factors identified by the Inspector as supporting the formation of his belief which I have set out at [15] and [17] above.
Mr Tooma drew attention to the Inspectors reliance on s 195(1)(a) and focussed on the use of the present tense "is occurring" in that paragraph. He submitted the evidence supported the conclusion that the only activity occurring at the site at the time of the inspection, which he submitted was the relevant time, was the rectification work. The rectification work, including excavation for that purpose, was permitted by the Prohibition Notice. The submission drew a distinction between subparagraphs (a) and (b) of s 195 and noted that the Inspector had made an election to rely only on the former. He did not express a belief that something may be done which may create a hazard (as provided for in s 195(1)(b)) but that something was occurring which created a hazard.
The risk identified by the Inspector was the risk of the wall collapsing. That was a risk which the chartered engineer had opined did not exist. The applicant submitted it was not reasonable to ignore the opinion of a qualified expert. Before dismissing that opinion he should have made further inquiries.
Mr Tooma then addressed the various factors listed in [15] and [17] which underpinned the Inspectors belief. He said the workers on the site were there for the purpose of the rectification work as indeed was the excavator. The suggestion from the complainant, Ace, that they were being "pushed" to continue the excavation, Mr Tooma submitted, was from a person who was in control of the excavation works. They were entitled to refuse to undertake further works if they considered a risk to health and safety existed.
Finally, as to the size of the two cracks the Inspector observed, the applicant submitted that that concern was not reasonable in the face of the engineers report.
Mr Magee sought to distinguish the decisions of Halley v Kershaw and George v Rockett firstly on the basis that they were concerned with proof in criminal proceedings and secondly on the basis that the issue in those cases concerned whether there were reasonable grounds to support a belief rather than a reasonable belief.
Counsel drew attention to the decision of Backman J in Essential Energy v WorkCover Authority of New South Wales [2012] NSW IRComm 83. In that matter her Honour was considering an application for a stay pending an external review of a decision following internal review of a decision to issue an improvement notice. At [24] Backman J said: It should be borne in mind that when Mr Larobina conducted his internal review of the Inspector's decision to issue the Improvement Notice, the matters referred to above only required his assessment in the context of whether or not the Inspector held a reasonable belief that the applicant had contravened s 19, "in circumstances that make it likely that the contravention will be repeated". In accordance with the orthodox approach, the Inspector's reasonable belief is to be assessed objectively: see George v Rockett and Another (1990) 170 CLR 104 at 112. (Emphasis added)
In an attempt to distinguish George v Rockett Mr Magee made the following submissions: The statutory scheme that was considered by the High Court in George v Rockett is different to that contained in either section 191 or 195 of the WHS Act. The relevant provision included the following words "If it appears to a justice, on complaint made on oath, that there are reasonable grounds for suspecting that…". The High Court in George v Rockett were therefore looking at a circumstance where a statute prescribes that there must be "reasonable grounds" for a state of mind. In relation to that issue the High Court concluded at (112) that 'it requires the existence of facts which are sufficient to induce that state of mind in a reasonable person'. Therefore, the High Court was laying down a two stage process, which involved both an objective element and a subjective element. Section 195 does not include a requirement for there to be 'reasonable grounds' for the Inspector's belief. It requires the Inspector to hold the belief, and for that belief to be 'reasonable'. It can be inferred that the reference to 'reasonable' requires the 'belief' to be soundly based and not 'unreasonable' or 'capricious'. It is therefore the belief of the inspector, based upon the circumstances as the inspector perceives them to be, which has to be reasonable and not the belief of some hypothetical person in the position of the inspector.
As I understand the first part of these submissions the "objective" element is the proof of reasonable grounds while the subjective element is the proof of the belief. It is then submitted the Inspector was not required to prove reasonable grounds. He had to form a belief which is reasonable. Reasonableness is to be determined by the perceptions of the Inspector and is therefore subjective.
Mr Magee then submitted that the Object of the Act is a key element informing what is reasonable in the circumstances. In that regard he referred to the decision of Schmidt J in Hunter Quarries Pty Ltd v New South Wales (Department of Trade & Investment) [2014] NSWSC 1580 at [22] and [23] and Essential Energy at [47]. In the latter case Backman J went on to say at [48]: Nevertheless, the public interest factor must be considered by reference to the facts and circumstances arising in any particular case. Here, the work being undertaken by Ronin on the applicant's network on the day of the incident has been completed, and there is no longer any immediate exposure to the risk to Ronin's employees. The relevance of the factor of public interest therefore falls to be considered by reference to the particular facts and circumstances relevant to the likelihood of a continuation or repetition of the contravention.
The respondent's submissions were then directed to the detail of the circumstances known to the Inspector at the time he issued the Prohibition Notice. Particular reliance is placed upon the fact that the rectification works directed by the engineer had "not been implemented". To emphasise the importance of that, reliance was also placed upon the extent of those rectification works and the opinion expressed by the engineer in his report dated 13 June. Mr Magee submitted: The Inspector therefore formed the belief that should excavation works be permitted to continue at this site, including in the vicinity of the Wall, in the absence of the completion of the rectification works specified by Bekker Engineering, that there was a risk that vibrations from the excavator or other sources, could result in the collapse of part of the Wall. The collapse of part of the Wall would give rise to a serious risk of injury to workers working in the excavation, or in the vicinity of the top of the Wall at the site. That such a hazard and risk remained imminent is supported by the evidence that as at 13 June 2017, some four days after the issuing of the Notice, the Bekker Engineering report dated 13 June 2017 (O'Brien affidavit at annexure F) discloses that many of the rectification works for the Wall had not been completed. Further, Bekker Engineering were recommending the re-installation of the earth berm at the toe of the Wall, in locations where additional anchors have not been installed. It is also significant that Bekker Engineering's confirmation of the safety to commence excavation works in the vicinity of the Wall is qualified by the following: "We confirm that with the berm in place it will be safe to access the excavation to complete the bulk excavation work". In the light of that statement it is plain that as at the date upon which the Inspector issued the Notice there was sound grounds for him to form a belief that there remained a potential serious risk to the health or safety of a person emanating from an immediate or imminent exposure to a hazard. It was therefore appropriate for the inspector, in the interests of securing the highest level of protection for workers against harm to their health, safety and welfare from hazards and risks arising from the work, to give the applicant, as a person who had control over the excavation activities at the Site, a direction prohibiting the carrying on of the excavation works, until an inspector is satisfied that the steps proposed by Bekker Engineering to make the Wall safe had been implemented, and that Bekker Engineering had certified that the matters that gave rise to the risk had been remedied. Upon being provided with the letter from Bekker Engineering dated 13 June 2017 (O'Brien affidavit at annexure G), the inspector was satisfied that the steps proposed by Bekker Engineering to make the Wall safe had been implemented (or would shortly be completed), and that the matters that gave rise to the risk had been remedied, and then lifted the prohibition on excavation work contained in the Notice (O'Brien affidavit at annexure G).
Lastly, Mr Magee firmly cautioned the Commission about taking into account the evidence of Mr O'Brien about the impact of prohibition notices on the commercial and reputational interests of a PCBU. Mr Magee submitted: ..they are not relevant factors for the Inspector's reasonable belief. Your Honour would be erring and going into improper territory to have regard to that because it is not the effect of the prohibition notice on the applicant, it is a relevant matter to the reasonable belief of the Inspector. If your Honour goes beyond that I think your Honour is erring.

Test of Reasonable Belief

I accept Mr Tooma's submission that the test is objective. That is consistent with the authorities to which he referred and the decision of the Industrial Court in Essential Energy. As Backman J noted in that case, it is the orthodox approach. The use of the word reasonable introduces objectivity into the consideration of whether the Inspector has acted appropriately. Were it otherwise, as suggested by Mr Magee, the legislation need not use the adjective "reasonable". It would depend solely on whether an Inspector forms a belief. Even the respondent's submissions do not go that far.
Mr Magee says the belief must be soundly based. I find, with due respect to Counsel, the distinction elusive if not illusory. How does one determine whether the belief is soundly based if not by an objective analysis? The suggested answer was that it depends upon the perceptions of the particular inspector. Again, even if that be correct, those perceptions must be soundly based. The parliament surely would not have intended that a notice issue on the clearly held but completely mistaken perception of an inspector.
In George v Rockett the Court observed at p 112: When a statute prescribes that there must be "reasonable grounds" for a state of mind - including suspicion and belief - it requires the existence of facts which are sufficient to induce that state of mind in a reasonable person. That was the point of Lord Atkin's famous, and now orthodox, dissent in Liversidge v. Anderson … That requirement opens many administrative decisions to judicial review and precludes the arbitrary exercise of many statutory powers... Therefore it must appear to the issuing justice, not merely to the person seeking the search warrant, that reasonable grounds for the relevant suspicion and belief exist … It follows that the issuing justice needs to be satisfied that there are sufficient grounds reasonably to induce that state of mind. (References and citations omitted) I can identify no good reason to depart from that approach. The fact that a decision of this kind is subject to a merits review strengthens the argument that the test must be objective.
Nor do I find a basis for distinction in the fact that George v Rockett and Halley v Kershaw are cases which involved criminal proceedings. The former is concerned with a prosecution but only indirectly. It is about the circumstances which justify the issue of a search warrant which is an administrative step in the course of an investigation and prosecution. In any event the context informs what may be reasonable in any particular case.
In connection with that the respondent points, quite correctly, to the Object of the Act. Mr Magee draw particular attention to s 3(1)(a) and s 3(2) of the Act which I have earlier set out. There is no doubt those provisions identify an important public interest, the health and safety of persons at work. The law often grapples with competing public interests - in this case the health and safety of persons at work and the right of a PCBU to conduct its business lawfully and efficiently. No doubt that is why the Object refers to a "balanced …framework". Competing public interests were identified in George v Rockett. At p 110 the Court said: A search warrant thus authorizes an invasion of premises without the consent of persons in lawful possession or occupation thereof. The validity of such a warrant is necessarily dependent upon the fulfilment of the conditions governing its issue. In prescribing conditions governing the issue of search warrants, the legislature has sought to balance the need for an effective criminal justice system against the need to protect the individual from arbitrary invasions of his privacy and property. Search warrants facilitate the gathering of evidence against, and the apprehension and conviction of, those who have broken the criminal law. In enacting s. 679, the legislature has given primacy to the public interest in the effective administration of criminal justice over the private right of the individual to enjoy his privacy and property. The common law has long been jealous of the prima facie immunity from seizure of papers and possessions: see Holdsworth, A History of English Law, vol. 10 (1938), pp. 668-672. Except in the case of a warrant issued for the purpose of searching a place for stolen goods, the common law refused to countenance the issue of search warrants at all and refused to permit a constable or government official to enter private property without the permission of the occupier: Leach v. Money ; Entick v. Carrington . Historically, the justification for these limitations on the power of entry and search was based on the rights of private property: Entick. In modern times, the justification has shifted increasingly to the protection of privacy: see Feldman, The Law Relating to Entry, Search and Seizure (1986), pp. 1-2. State and Commonwealth statutes have made many exceptions to the common law position, and s. 679 is a far-reaching one. Nevertheless, in construing and applying such statutes, it needs to be kept in mind that they authorize the invasion of interests which the common law has always valued highly and which, through the writ of trespass, it went to great lengths to protect. Against that background, the enactment of conditions which must be fulfilled before a search warrant can be lawfully issued and executed is to be seen as a reflection of the legislature's concern to give a measure of protection to these interests. To insist on strict compliance with the statutory conditions governing the issue of search warrants is simply to give effect to the purpose of the legislation. It will be convenient to consider the relevant conditions prescribed by s. 679 under three headings: the justice's function, the material to ground the issue of a warrant and the facts to be established. (Citations and references omitted) (Emphasis added)
While I accept the submission of the respondent that the Object of the Act informs the determination of what is reasonable, that does not involve an acceptance that the test is subjective and to be judged from the perception of an inspector. Further, I observe that Backman J, in the passage cited at [52], referred to the need to consider the identified public interest by reference to the particular facts of the case.
The construction is reinforced by the availability of internal and external reviews of the decision. The respondent submitted, as noted at [35], that this review is a hearing de novo and a process in which the Commission stands in the position of the decision maker. Such a review is not consistent with a subjective test. It is entirely consistent with an objective test.

Was the Inspector's belief reasonable?

I accept that the Inspector formed a belief.
In favour of the belief being reasonable there are a number of objective circumstances including, at least at face value, the matters listed in [15]. It is necessary to consider the substance of each of those matters.

The presence of workers at the site

There were undoubtedly workers present on the site. In his Summary the Inspector notes in particular the workers in the excavation. He notes, however, they were there to undertake the rectification works as directed by the engineer. The Prohibition Notice he issued would not have changed that circumstance because it allowed those works to be undertaken. He had accepted an undertaking from the applicant that they would develop, in conjunction with others, a Safe Work Method Statement ("SWMS") to allow the works to be undertaken safely.

The size of the two cracks in the wall

The Inspector observed these cracks and was rightly concerned about the potential failure. As indeed was Mr Radopolous based on his email to Mr Bekker dated 1 June. In his affidavit Inspector Mann said he was concerned the wall may collapse because of the weight of earth behind it. He referred in his oral evidence to "sandy material… in situ behind it". Although not a geologist, he was concerned that vibration may cause the sand to compact and place further pressure on the wall. He understood the berm was in place to guard against collapse. He saw the email from the engineer opining that the wall was not in danger of collapse. The engineer also said that it was safe to work in the excavation. The Inspector considered (or assumed) that meant further excavation might be carried out.
He did not regard the engineer's report as sufficient because it was not supported by reasons or perhaps because it was not on letterhead. As to the former the email does state that: The loads behind are minimal as the ramp behind has piers Perhaps the anchor has taken up a fraction allowing some movement These statements articulate reasons in support of the opinion that the wall was not in danger of collapse and why the cracks had appeared. The reasons may not be comprehensive but they are present. The contact details of the engineer were disclosed but no attempt was made by the Inspector to contact him. The same consideration applies to the concern about letterhead.
It is also noteworthy that the Inspector was aware the cracks had appeared some 8 days earlier and the engineer had been involved immediately.

The information provided with the anonymous complaint

The information was contained in the WSMS Report. There were a number of matters listed in that report. They were: Fail to Notify Collapse of structure & The collapse and failure of the excavation and shoring supporting excavation. Excavation on both the site commenced 5-6 months ago 40 workers between both sites Excavation has been done very deep and the shoring and walls that they have done is not right they are extremely unsafe On the 1/6/2017 the shoring & wall that is there failed and the PCBU did not notify safe work and tried to cover it up as quickly as possible. Onsite today with the overnight rain - It's a mess and only going to get worst and supporting walls will fall. Workers have photos on their phone and if an inspector goes to site they are willing to show the photo's
The first matter to note is the alleged failure to notify. As to that the Inspectors evidence was that he took no further action because he formed a view there had been no breach of the notification provisions. That involves the following implicit conclusions by the Inspector: 1. The applicant had not failed, immediately or at all, to notify contrary to the Act; 2. There had not been a dangerous incident giving rise to a duty to notify; and 3. There had not been a "collapse or failure of an excavation or shoring". These conclusions necessarily involve the Inspector rejecting the allegations of failure or collapse of the excavation or shoring and of failure to notify. What remains is allegations of inadequate shoring, extreme risk arising from that and overnight rain causing the situation to worsen.
Contradicting the alleged risks of failure, in what are anonymous allegations, is the report from the engineer indicating the absence of risk and the steps necessary to minimise or eliminate risks from developing. Mr Magee submitted that I could not accept the engineer's opinion principally because there was no evidence that he had been on site. I reject that submission. The email itself suggests that he had visited the site on 31 May. Moreover it is clear he attended the site on 2 June and 7 June. It would not have taken much inquiry for the Inspector to satisfy himself of those matters. A simple phone call may have sufficed.
The existence of the various markings indicating the anchor points may have prompted an inquiry from the Inspector as to why that was happening, given the email he saw referred only to "an" additional anchor. An inquiry as to that may have led to the provision of the engineer's Site Inspection Reports and disclosure of his attendance at the site.
The Inspector spoke to Mr Molloy who was on site to undertake the drilling for the installation of the anchors. Apart from a discussion as to the role Mr Molloy and his colleagues were to undertake, it appears there was no further information sought from him by the Inspector.
The overnight rain had apparently happened 2-3 days prior to the Inspector's attendance at the site and therefore any impact would have been apparent. No collapse or failure of the shoring had occurred and the engineer's view was that it would not.

The presence of an excavator in the excavation

The Inspector says he was concerned by the presence of the excavator. He understood that excavation had ceased when the cracks appeared some 8 days earlier. He further understood that the excavator had then been used to construct the berm to stabilise the wall pending rectification works. It had not otherwise been used.
Although he was unaware of this because he did not see the engineer's Site Inspection Reports, the rectification works involved at one point excavation. So there were a number of good reasons for the presence of the excavator. There is no evidence the Inspector made any inquiry as to why the excavator remained in the excavation. He did say that the engineer's opinion he saw suggested excavation works may continue but that email was sent 7 days prior and no further excavation works had been undertaken. The decision to cease excavation was taken and maintained during a period in which SafeWork NSW was unaware of any issue with the wall. Is it reasonable to assume that situation would change once SafeWork NSW was aware?

A belief that excavation work would continue

The question here is whether that belief was reasonable or, to put it in the respondent's terms, soundly based. The basis of the belief was the presence of the excavator. I have discussed above the known circumstances explaining the presence of the excavator and the extent of its use. In my view those circumstances do not justify the formation of that belief particularly absent further inquiry by the Inspector.
There were two other factors referred to as supporting the Inspector's belief. The statement in the email from the engineer about continuation of work, and the statement by Ace that they were being "pushed" to continue the work.
I have commented on the former in [70] above and, particularly because of the lapse of time, do not find it convincing as a reason for the belief. As to the latter, it was a passing comment by the Inspector which did not feature in his statement of reasons for forming his belief as to the existence of a hazard as set out in his affidavit. It was not set out in the WSMS Report. There was no suggestion he raised it with the representatives of the applicant. Moreover, as Mr Tooma submitted Ace was responsible for the excavation works and were entitled to decline if they perceived a risk to safety.
Finally, the Inspector accepted a commitment from the applicant to restrict access to the excavation until the wall was "made safe" and to work with Ace to develop a safe work method statement for the rectification works. In those circumstances the statement said to have been made on behalf of Ace has little significance.

Other Matters

Mr Magee submitted that the extent of the rectification works ultimately directed by the engineer pointed to the existence of a risk of the wall collapsing. He noted that even the final report was qualified in that it referred to the need for the berm to remain in place until the final anchors were installed for safe completion of bulk excavation work.
I accept the validity of the first point but note it was not a factor underpinning the Inspector's belief. He was not aware of the Site Inspection Reports and the detailed instructions. He was aware of the markings on the wall but made no significant inquiry. If the test is, as the respondent submitted, whether the Inspector's subjective belief was soundly based these matters would be irrelevant because they were not part of his reasoning.
The difficulty with the second point is that the Inspector lifted the prohibition "notice" once he received that Report. The berm had been in place the whole time but was argued to be inadequate until the rectification works were complete. They were not yet complete but the notice was lifted based upon the opinion of the engineer. Why was the first opinion insufficient but the latter adequate. It is open to say that the latter opinion is not supported by reasons so, apart from the completion of some of the rectification works, what is the difference?

An activity occurring

The belief formed by the Inspector was: that an activity was occurring at the site that involved a serious risk to the health and safety of one or more more persons. He also: formed a view that the serious risk emanating from an immediate exposure to a hazard and that the activity was contravening section 19 of the Act
The hazard identified in the Prohibition Notice was; possible movement of the Castec wall resulting in cracking on the Northern section of the wall
In his affidavit the Inspector referred to forming a view that: the wall was in danger of collapsing due to the weight of earth behind it.
It is clear from his evidence that the activity the subject of concern to the Inspector was the bulk excavation work. That was what he prohibited. He was concerned that that activity would cause movement in or a collapse of the wall endangering persons working above the wall or in the excavation.
Mr Tooma submitted that at the time of the issue of the notice the only activity on the site was in relation to the rectification works. The Inspector, by electing to rely on s 195(1)(a) rather than s 195(1)(b) was confined to the immediate timeframe. No authority was referred to and I am not aware of any which is decisive of this point. It is necessary therefore to construe the legislation on the well-established principles. In that regard the Object of the Act, as discussed above, informs the approach.
The purpose of s 195 is to permit inspectors to take preventative action to ensure the Object of the Act is fulfilled.
Once again particular attention must be paid to s 3(1)(a) and s 3(2) of the Act. In my opinion, bearing in mind the Object, it is appropriate to give the expression "is occurring" as it appears in s 195 as broad a construction as the words will fairly allow. Thus, in this case excavation work had been proceeding for some months. It was not yet complete. It had been interrupted because of an issue with the Castec wall. Once that issue was addressed the excavation work would continue. Those circumstances, in my view, fall comfortably within the first paragraph of s 195(1).
I do not exclude the possibility of them also falling within the second paragraph of the subsection. That paragraph would also cover circumstances were the activity is planned but has not yet commenced. The protective nature of the legislation militates against an unduly technical grammatical approach.
Even if I be wrong in that view it seems to me the Prohibition Notice may be supported on the basis of paragraph (b) of s 195(1) on the authority of Re Australian Conciliation and Arbitration Commission; Ex parte Graham [1977] HCA 20; 138 CLR 164. In that case the High Court considered a challenge to an award of the Australian Conciliation and Arbitration Commission on the basis, among others, that the Commission had purported to act under one section when its power resided in another section of the governing statute. Gibbs J gave the leading judgment. As to this point he said: Prohibition will not lie to the Commission if, acting within jurisdiction, it makes awards which it had power to make, simply because it thought that its power was conferred by one section whereas in truth it was given by another. Even without the privative provisions of s. 60 of the Act, prohibition would not lie in such a case. I have already mentioned that the Commission acted not simply because it felt constrained by s. 28 but because it considered that it was in the public interest to do so, and in these circumstances it is not possible to argue that there was no real exercise of power. Moreover, if on 30th September and 1st October 1976 the Commission acted for the purpose of making it clear that the matter was within the jurisdiction of the Commission, that would be no objection to the validity of the awards nor, if it matters, any ground for criticizing the exercise by the Commission of its discretion. On the assumption that the Commission had jurisdiction, it was perfectly proper for the Commission to make an interim award for the purpose of avoiding conflicting action by a State Industrial Tribunal.
In this case the concern of the Inspector was as to the resumption or recommencement of bulk excavation works before the wall was "made safe". As I have noted, his concerns fell, in my opinion, within either paragraph of the subsection, but I do not consider the Prohibition Notice would be invalid because he chose one paragraph when he should have chosen the other. Subject to the formation of the reasonable belief he had authority to issue the notice.
It does not follow, because "bulk excavation work" may be regarded as occurring within the meaning of s 195(1)(a) of the Act, that the Inspector's belief was reasonable. As a matter of fact, bulk excavation work was not in progress at the time the Prohibition Notice was issued. There were many objective factors to be weighed by the Inspector at that point in time. That was one of them. It is to be remembered that the Act's object is to provide for "a balanced and nationally consistent framework". The Inspector needed to balance all of these various factors reasonably to form his "inclination of mind".
I have referred, in these reasons, to additional inquiries the Inspector may have undertaken. I do not intend by those comments to suggest that the Inspector was required to conduct a full investigation. That would be contrary to the authorities such as George v Rockett, Halley v Kershaw and Essential Energy. The Inspector was not required to satisfy himself to the level of proof of a breach of the Act. Prohibition Notices are intended to prevent potential breaches so that is beyond what is required of him.
An inspector is however required to balance the objective information available to him, and is obliged to make reasonable inquiries. If he had attempted to make contact with the engineer and not been able to speak with him, for example, that would provide a different factual matrix than making no attempt to clarify any concerns about an expert engineer's opinion that contradicted his view. A similar point may be made about failing to raise with Mr Radopolous the allegation made by Ace or why the excavator was still in the excavation. The Inspector is not bound by the responses but must take them into account in forming his view.
A reasonable and balanced approach does not allow an inspector to make assumptions and act on them without, at least, attempting to test, in a timely and practical manner, the validity of those assumptions.

Conclusions

I reach the following conclusions based on the above: 1. The Inspector formed a belief. 2. At the time of forming his belief the Inspector was not satisfied that there had been a failure to notify contrary to the Act, or a collapse of an excavation or a failure of shoring. 3. The activity of bulk excavation was "occurring" within the meaning of s 195(1)(a) of the Act in the sense that the activity had been ongoing for several months and was not yet complete. 4. At the time of the inspection and for the proceeding 8 days no bulk excavation work had been undertaken. 5. The applicant had proactively engaged a chartered engineer to advise in relation to cracks which had developed in the wall. 6. The engineer had visited the site regularly during the relevant period and produced Site Inspection Reports. 7. The engineer considered the wall safe but recommended the placement of a berm at the base of the wall pending completion of rectification works. 8. The rectification works had been commenced but not completed at the time of the Inspector's site visit. 9. The only works being undertaken in the excavation were the rectification works. 10. The applicant had agreed to take various actions to ensure the health and safety of persons working at the site including restricting access until the rectification works were complete. 11. The Inspector accepted those undertakings. 12. The presence of an excavator was consistent with a number of reasons, including use in the rectification works, other than the resumption of bulk excavation work. 13. There was no reasonable basis, having regard to the undertakings, to suspect that excavation works would be resumed prior to the wall being "made safe". 14. The belief formed by the Inspector was not reasonable in the objective circumstances then existing.

Order

I make the following orders: 1. The external review is upheld. 2. The decision taken to have been made on the internal review is revoked. 3. The decision to issue Prohibition Notice 38360 is revoked.

Endnotes

NSW Rural Fire Service v SafeWork [2016] NSWIRComm 4
[2010] VSC 343.
Ibid [14]; DPP v Mitchell [2002] VSC 326, [39] (Gillard J).
Ibid.
George v Rockett (1990) 170 CLR 104, 116.
[2010] VSC 343, [34].
Woods v Gamble (1991) 13 MVR 153, 156 (Fullagar J).
Cf Walsh v Loughnan [1991] 2 VR 351, 356 (Vincent J). DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 17 January 2018

Work Health and Safety Act 2011(NSW)s 195(1)(a), ss 3, 35, 37, 38, 195, 223, 224, 226

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