Inspector Dugdale v Fluid Tech Hydraulics Pty Ltd

Judgment 1By amended application for order the prosecutor, Inspector Edward Dugdale of the WorkCover Authority of New South Wales, has charged the defendant, Fluid Tech Hydraulics Pty Ltd, with a breach of s 11(1)(a) of the Occupational Health and Safety Act 2000 ("the Act"). 2The charge is that the defendant, being a supplier of plant "did between about 5 September 2006 and about 13 October 2006, at 115-137 Rookwood Road, Yagoona, in the state of New South Wales ("the premises") failed to ensure that the plant it supplied was safe and without risk to health when properly used ...". 3The particulars of the charge, as set out in the amended application for order, are as follows: (a)The defendant was a supplier of plant; (b)The defendant supplied to Weldlok Industries Pty Ltd a high-pressure oxygen transfer line and associated equipment including a hose for use by people at work; (c)The defendant supplied the plant to Weldlok Industries Pty Ltd at its premises at 115-137 Rookwood Road Yagoona in the State of New South Wales; (d)The risk was the risk of non employees of the defendant being injured by high pressure oxygen line and its components exploding and the high pressure oxygen transfer hose and connector (elbow) separating and coming away from the gas cylinder bank manifold piping and striking them. (e)The defendant did not undertake any tests on the hose or other components so as to ensure that they were safe for use in a high pressure oxygen line and would not put people at risk; (f)The defendant did not confirm the components supplied by Alfagomma were suitable for a high pressure oxygen line and would not put people at risk; (g)The defendant failed to ensure that plant was safe when properly used in that the hose supplied was not certified or approved for use in a high pressure oxygen application. (h)The defendant failed to conduct a risk assessment in relation to any of the components of the high pressure oxygen line before or after its installation so as to consider and identify the risks associated with it and the means by which the risk could be eliminated. As a result of the defendant's omissions employees of Weldlok Industries Pty Ltd, and in particular Hasib Kamenjasevic, were placed at risk of injury. 4Section 11(1)(a) of the Act is in the following terms: 11 Duties of designers, manufacturers and suppliers of plant and substances for use at work (1)A person who designs, manufactures or supplies any plant or substance for use by people at work must, so far as is reasonably practicable: (a)ensure that the plant or substance is safe and without risks to health when properly used ... 5The defendant had indicated at an early stage that it intended pleading guilty to the charge in an earlier form. There were then negotiations between the parties that resulted in the amended application for order being filed on 11 November 2010. There then arose a controversy about whether the defendant would plead guilty to particular (f) of the charge, which is set out above. The defendant's solicitor indicated, in a letter dated 11 February 2011, addressed to the prosecutor's solicitors, that the defendant would plead guilty to the charge as particularised "to the extent that it is alleged the defendant did not confirm (subsequent to the order of the hose) that the hose provided was suitable for oxygen." In essence, the defendant had through an employee placed an order with an employee of a business called Alfagomma Australia Pty Ltd ("Alfagomma") for the supply of a hose and other component parts. This had occurred on either 24 or 25 August 2006. The hose and other component parts were installed at the premises of Weldlok Industries Pty Ltd ("Weldlok") on about 5 September 2006. The defendant asserted, and the prosecutor denied, that at the time that an order was placed for the supply of the hose by Alfagomma to the defendant the representative of Alfagomma confirmed that the hose was suitable for a high pressure oxygen line. This controversy was litigated and the hearing of the evidence about it occupied two hearing days. After submissions had been made by both parties on a further hearing day, I delivered an ex tempore judgment in which I found that, on the basis of the evidence, I was satisfied that the representative of Alfagomma had corroborated or verified and, therefore, confirmed that the hose was suitable for a high pressure oxygen line and that this occurred at the time that the order was placed for the hose. 6Accordingly, the charge was confined to the period commencing about 5 September 2006 and ending about 13 October 2006 and, as acknowledged by the prosecutor, it did not apply to the date on which the order for the hose had been placed, which had occurred on 24 or 25 August 2006. The defendant then entered a plea of guilty to all of the particulars in the manner in which they were formulated in the amended application for order. 7The factual finding that I made will have some impact upon the determination of the proceedings, for reasons that I shall shortly state. It is sufficient at this stage to note that the defendant having entered a plea of guilty, this judgment is confined to the assessment and imposition of an appropriate penalty. 8There was filed in Court an amended agreed statement of facts, which is in the following terms: (1)The Prosecutor is an Inspector duly appointed under Division 1 of Part 5 of the Occupational Health and Safety Act 2000 ("the Act") and empowered under Section 106(1)(c) of the Act to institute this proceedings. (2)At all material times Fluid Tech Hydraulics Pty Ltd ("Fluid Tech") [ACN 076 788 433] was a corporation whose registered office is situated at Unit 1B, 6 Raymond Street, Lidcombe in the State of New South Wales. (3)Fluid Tech's business was in the design, manufacture, machining, welding, installation and maintenance of hydraulic and pneumatic systems. Fluid Tech's business operates from 1B Raymond Street, Lidcombe. (4)Fluid Tech employed about nine full time employees and three casual employees in October 2006. One of the employees of Fluid Tech was Mr Charles Woolf ("Mr Woolf"). Mr Woolf was employed as a service technician who had responsibility for on site installations and maintenance for customers of Fluid Tech. (5)Phillip Patrick Walker ("Mr Walker") was a director of Fluid Tech and he worked in the business. (6)Weldlok Industries Pty Ltd ("Weldlok") was a corporation which undertook the business of manufacture and supply of galvanised steel products. (7)Weldlok operated a welding fabrication workshop at its premises located at 115-137 Rookwood Road, Yagoona (the premises). The premises consisted of a number of buildings. A gas storage area was located within the premises. (8)Weldlok was a customer of Fluid Tech. Weldlok had been a customer of Fluid Tech for about fifteen years. During that time Fluid Tech had attended to the repair and maintenance of various kinds of hydraulically powered machinery at the premises. (9)In about April 2006 Fluid Tech agreed to install a high pressure oxygen line for Weldlok at the premises. The cost of supply and installation of the high pressure oxygen line was about $1,400. The installation of the High Pressure Oxygen Hose and Pipeline (10)Fluid Tech installed for Weldlok, at the premises, the hose and pipeline for the high-pressure oxygen line. The installation was undertaken by Mr Woolf on behalf of Fluid Tech on about 5 September 2006. Mr Woolf was responsible for obtaining all of the components (including the hoses) for the high pressure section. Mr Woolf's supervisor was Mr Walker. Mr Woolf had a trade qualification as a fitter/machinist. Mr Woolf had seven years experience with working with high pressure gas and nitrogen gas lines. His usual duties did not include the installation of high pressure oxygen gas lines and he had received no formal training in these installations. Mr Woolf had no experience in high pressure oxygen installations at the time he undertook the installation at the premises. (11)The hose was ordered by Mr Woolf. The hose and components for this installation were supplied to Fluid Tech by Alfagomma. The hose (8A6AA) as supplied by Alfagomma was a wire braided rubber hose. The 8A6AA hydraulic hose was build primarily for hydraulic application and not for the transfer of gases. The hose is not recommended for use in high-pressure oxygen application. To recommend any product for high-pressure oxygen transfer, a product must be suitably assessed and type tested to ensure its suitability for the application. (12)Alfagomma were not asked to confirm the hose was suitable for a high pressure oxygen line. The work done by Fluid Tech in installing the high pressure oxygen line included: measuring up all the pipes to be cut and bent; cutting and bending the pipes; bending and flaring the pipes to go to the manifold; mounting the pipes to the wall; cleaning all parts as they were assembled using thread tape; assembling all of the components; fitting the hose; and making sure the whip checks were on the hose and were secured to the wall and the oxygen bottles. (13)There were no tests of the hose or other components undertaken prior to the supply and installation of the high pressure oxygen line. There was no risk assessment undertaken of any of the components of the high pressure oxygen line before or after its installation. Fluid Tech did not confirm the components supplied by Alfagomma were suitable for a high pressure oxygen line. Neither Mr Woolf nor Mr Walker confirmed that the hose that Fluid Tech supplied to Weldlok was suitable for a high pressure oxygen line. (14)Prior to commissioning the system Mr Woolf tested the external areas of the system with soapy water, opening up the ball valve on the wall and slowly releasing the pressure into the line by the needle valve on the oxy pack. There was no leaking fittings visible. The testing was not documented. Fluid Tech did not provide Weldlok with a certificate or letter of commissioning of the installation. Neither Mr Woolf or Mr Walker told anyone from Weldlok that there would be a need to undertake an assessment or test of the plant so as to ensure it was safe when used. Nor did Fluid Tech provide any information to Weldlok about this plant. (15)Alfagomma did not have a hose within their available range that they would recommend for high pressure oxygen transfer. They would, if required, supply a product having outsourced it from a specialist supplier. Alfagomma considered that oxygen ageing of the liner material is a type test that would be performed if evaluating the hose for oxygen service. The hose is a hydraulic hose and as such the liner had been tested primarily for oil resistance and not for oxygen service. The Incident (16)Mr Hasib Kamenjasevic was employed by Weldlok and undertook duties at the premises. Mr Kamenjasevic commenced his employment with Weldlok on the 18 October 1996 and has been in the position of shift supervisor for 6 years. Mr Kamenjasevic's main duties included welding, cutting and moving material. He also regularly undertook the task of changing of gas cylinder packs. Mr Kamenjasevic was 63 years old at the time of the incident referred to below. (17)Mr Kamenjasevic was found lying on the concrete floor in the oxygen storage compartment in the gas storage building by Mr Ahmed Issa. The oxygen storage compartment was located on the south side of the gas storage building. The gas storage building was located at the eastern side of the premises behind the metal fabricating factory. (18)At the premises a high pressure oxygen cylinder bank and regulator were located at the back of the gas storage building inside one of the gas storage compartments (bays). Three types of gases namely Corgon, Acetylene and Oxygen were stored in the gas storage building. Each type of gas was stored in a separate compartment (bay). Each compartment (bay) measured approximately 2.7 metres wide x 4.1 metres deep x 2.6 metres high. The oxygen cylinder storage compartment was located to the left of the other gas storage compartments. The other compartments held high pressure cylinders containing Corgon (Argon) (centre bay) and acetylene (right hand bay) along with their associated regulators and piping. (19)At approximately 1.30 pm Mr Kamenjasevic was working alone in the oxygen gas storage compartment (bay) at the premises. Mr Ahmad Issa, a production labourer employed by Weldlok was undertaking duties in gas storage building. Mr Issa heard a "pop noise" and ran outside the compartment he was in and to the oxygen gas storage compartment where he thought someone must be due to the door being open. Mr Issa found Mr Kamenjasevic in the compartment, "laying in the corner with blood all around him". Mr Issa called out Mr Kamenjasevic's name but got no response. Mr Issa noticed when he first entered the compartment that oxygen was coming out of one of the oxygen bottles within the compartment. Two other workers then also arrived on the scene and Mr Issa proceeded to the office to call an ambulance. After calling the ambulance he returned to the oxygen gas storage area to assist Mr Kamenjasevic. Mr Kamenjasevic had been moved to outside the compartment at this stage. Mr Omar Issa, another worker who had arrived at the scene of the incident turned off the open oxygen bottle. Mr Ahmad Issa turned off the isolation valve for the oxygen located on the wall of the compartment. (20)Mr Kamenjasevic has no recollection of what he was doing at the time of the incident and there were no witnesses to the incident. (21)It appears that Mr Kamenjasevic had connected the high pressure oxygen cylinder bank transfer line up to the oxygen bank manifold (8 cylinders). As Mr Kamenjasevic turned the valve on, the high pressure oxygen transfer hose and connector (elbow) separated and came away from the gas cylinder bank manifold piping and Mr Kamenjasevic was struck on the head. It is unclear whether it was the end of the hose or the elbow that came into contact with Mr Kamenjasevic. (22)Mr Kamenjasevic sustained a traumatic brain injury, eye injury (no vision in both eyes) and multiple facial fractures as the result of an injury whilst working in the oxygen storage compartment at the premises. (23)After the incident, Mr Kamenjasevic was transport to Liverpool Hospital by the Ambulance Service of New South Wales (Re: Patient Health Care Record E780086) where he was examined. Acute Management occurred at Liverpool Hospital between 13 October 2006 and 16 November 2006 and included a decompressive bifrontal craniectomy, insertion of ICP monitor, repair of facial fracture, removal of (R) eye, insertion of tracheostomy tube. Mr Kamenjasevic was then transferred to the Brain Injury Rehabilitation Unit, Liverpool Health service (BIRU) for inpatient rehabilitation on 16 November 2006. Mr Kamenjasevic was discharged home on 24 May 2007. BIRU provides Mr Kamenjasevic with ongoing support and follow up. Mr Kamenjasevic has not return to work since the incident on the 13 October 2006. (24)Following the incident Inspector Desmond Lai inspected the site of the incident. His observations of the incident site included observing on the floor a right hand industrial glove, a hard hat, and an open ended spanner. A damaged silver coloured metal elbow was located on the ground in front of the oxygen bank and a damaged hose was connected to a metal lever type isolation valve on the southern wall. High Pressure Oxygen Pack (25)The 8 Cylinder high pressure oxygen gas pack is assembled from a standard 48-litre capacity "G" sized cylinder and is filled to a pressure of approximately 176 bar. All cylinders are manifolded together to allow all cylinders to be simultaneously exhausted through the two outlets provided. The high pressure oxygen pack supplied the oxygen to the Weldlok Workshop via a transfer line (hose) from the pack to the manifold located on the wall of the brick structure. The oxygen was used for cutting activities in the workshop. (26)Linde Gas Pty Ltd (Linde) supplied the Oxygen Cylinder Pack Serial # 6676 prior to the 13 October 2006 incident. The gas cylinder pack was changed once every one to two days. (27)The maximum pressure inside the cylinder pack would be 176 Bar. The maximum pressure inside the cylinder is determined during the filling of the pack. There are no regulators to control the delivery pressure to the customer built into the pack. The regulator that controls the delivery pressure to the customer pipeline is installed inside the stainless cabinet on the wall of the compartment and adjacent to the cylinder pack. (28)All hoses and pipeline installed prior to the regulator are deemed to be high pressure. All hoses after the regulator are deemed to be low pressure, around 4 bar. The maximum pressure released to the hose would be approximately 176 bar, this would be reduced as the contents are consumed, then the cycle would re-start with each new pack connected to the system. Safe Use of the High Pressure Oxygen Line (29)Fluid Tech provided no adequate advice, instruction or information to Weldlok about the safe use of the high pressure oxygen line. Fluid Tech did not test and did not arrange for testing of the high pressure oxygen line or the hose prior to supplying it to Weldlok. Fluid Tech did not provide Weldlok with any certification of the testing of the hose or a certificate of the commissioning of the new high pressure oxygen line. (30)A Prohibition Notice number 153307 was issued to Weldlok on 16 October 2006 requiring it to cease operating the gas storage compartment area until a competent person carried out a documented risk assessment and implement relevant and appropriate control measures. (31)After the incident, Weldlok contracted Linde to replace all hose and components in the gas storage area. The high-pressure hose and fittings in the oxygen gas bay were replaced. New valves, pipe work, regulators, flash back arrestor and non-return valves on the oxygen bank were fitted. The new installation by Linde was carried out in accordance with A.S 4289-1995 Oxygen and Acetylene gas reticulation system. Linde followed directives from their then parent company, Linde AG, in hose and component selection. The directive stated that only convoluted stainless steel hose was acceptable for high-pressure oxygen application. The new hose as fitted is a: 6mm NB, 1500mm long, female end connections, test pressure 45800Kpa, cleaned and bagged for oxygen service and a copy of test certificate supplied. Weldlok obtained a certificate of commission from Linde prior for the commissioning of the new system. (32)The following documentation is attached: (a)Factual Inspection report of Inspector Lai dated 13 October 2006 (b)23 Colour photographs taken by Inspector Lai on 13 October 2006 (c)10 Colour photographs taken by Inspector Lai on 13 October 2006 (d)6 Colour photographs taken by Inspector Lai on 3 September 2007 (e)Chemwatch Material Safety Data Sheet for Oxygen (f)Linde Gas Material and safety Data Sheet for oxygen (g)Report "Failure of Compressed Oxygen Hose - Observations" (h)Prior convictions certificate. 9I should immediately observe that the first sentence of [12] of the above amended agreed statement of facts and the third and fourth sentences of [13] are confined in their application to the period that is the subject of the charge, to which I have earlier referred. 10Paragraph 32(g) of the amended agreed statement of facts refers to a report that was prepared by Connell Wagner Pty Ltd. The author of the report is said to have had "project engineering experience with design and installation of piping and equipment in accordance with international standards for oxygen service as an equipment development engineer and project engineer at BOC Gases between 1986 and 1997." The report appears to be dated 17 December 2008. The opinion was expressed in the Connell Wagner report that the hose had failed in two areas and that both failures were likely to be the result of an explosion. 11The report noted: The components inspected ... showed no signage, nor markings nor documentation to indicate that they had been designed and cleaned for oxygen service. No traceability documentation was available to indicate the failed hose connection between the cylinder manifold isolation valve and wall mounted isolation needle valve had been degreased for oxygen service. 12The report went on to note that there may have been possible contamination in the hose prior to installation due to lack of cleaning for oxygen service or that the type of hose fitting could have given rise to particle impingement. On this basis the report concluded that the components "were probably not fit for the oxygen service for which they were employed." 13Furthermore, the report noted that a number of measures could have been undertaken including the cleaning or degreasing "for oxygen service both at the point of manufacture and after installation on application." There is also a reference to the means of preventing the line whipping in the event of an explosion, and, as the defendant pointed out, it had provided this protection when installing the components, albeit that it is probable that the whip check was not secured at the time that the explosion occurred. 14For the defendant, there was tendered into evidence for the purpose of the sentencing hearing an affidavit of Phillip Patrick Walker, a director of the defendant company, that had a great deal of documentary material exhibited to it. I shall refer to this evidence later in these reasons for judgment. 15The commencing point for a consideration of an appropriate penalty is an assessment of the objective seriousness of the offence. It was uncontroversial that the failure of a high pressure oxygen line could result from an explosion and that the consequences for anyone in the vicinity of the area would be potentially serious, as was the case in this unfortunate incident. Indeed, the injuries sustained by Mr Kamenjasevic were most serious including traumatic brain injury, loss of vision in both eyes and multiple facial fractures. 16The defendant, by its plea of guilty, has accepted that it is guilty of the omissions that are set out in (e), (f), (g) and (h) of the amended application for order, albeit that in the case of (f) the omission is confined to the period covered in the charge. Furthermore, the amended agreed statement of facts outlines, especially in [13] and [14] those matters that the defendant failed to carry out. At [31], the amended agreed statement of facts describes the components and fittings as installed by Linde Gas Pty Ltd. 17The defendant, for its part, emphasised that at the time its employee ordered the parts from Alfagomma he was told that their use in a high pressure oxygen line should "not be a problem." This was the first occasion upon which this particular employee had ever worked with a high pressure oxygen line and, on the evidence, he does not appear to have been closely supervised in carrying out the work which he later performed in installing the components at the premises of Weldlok. Furthermore, on the evidence given in the proceedings Mr Walker, the director of the defendant, had only had limited experience in dealing with high pressure oxygen lines. 18The prosecutor submitted that the breach by the defendant was of a most serious kind, calling for a penalty in the mid to high range. The defendant emphasised that initially, when the order was given for the supply of the hose and the other components, the representative of the supplier had confirmed their suitability for a high pressure oxygen line. Accepting, as I do, that the consideration of the objective seriousness of the offence must be undertaken having regard to the initial understanding of the defendant that the components were suitable for use in a high pressure oxygen line, there are nevertheless a number of matters which, in my opinion, point to a degree of culpability greater than that contended for by the defendant, namely one in the low range. There is simply no evidence that the defendant undertook some of the basic steps that are referred to in the Connell Wagner report, especially ensuring that there was appropriate signage or documentation displayed and that the hose had been cleaned for oxygen service to ensure that there was no possible contamination. The other failures of the defendant are, as I have previously said, to be found in [13] and [14] of the amended agreed statement of facts and as contained in the particulars of the charge, to which I have earlier referred. 19I would assess the defendant's culpability as being about mid range. 20In determining penalty I shall also take into account the general and specific deterrent effect that the penalty will create both generally within the industrial community and specifically for this defendant. In this latter regard, I note that, on the basis of evidence given in the proceedings, the defendant has taken a number of steps after the incident to improve and enhance its commitment to its obligations under the Act and that this would ameliorate to some extent the need to make particular provision for the specific deterrent effect of the penalty. 21There are a number of matters of a subjective nature that can be taken into account in favour of the defendant to justify a reduction of the penalty. 22The defendant entered a plea of guilty at an early stage in the proceedings. The prosecutor asserted that it was not at the earliest stage, because of the outstanding issue concerning particular (f), to which I have earlier referred. However, given the history of the proceedings, as I have briefly outlined them, and the conclusion that I reached after the outstanding factual issue was litigated, I am persuaded that the defendant should be entitled to a discount referrable to the entry of a plea at the earliest appropriate time. 23It was uncontroversial that the defendant had a good safety record, having no prior convictions, that it co-operated with the WorkCover Authority of New South Wales in and about its enquiries and investigations after the incident and that it has significantly improved its commitment to the discharge of its occupational health and safety obligations after the incident. It is also clear on the evidence that prior to the incident this defendant did have a commitment to occupational health and safety matters, albeit that they were capable of improvement, as occurred after the incident. 24The defendant asserted that it had expressed contrition and remorse for what occurred. There can be no doubt that the defendant, through its officers, expressed deep and sincere remorse for the injuries sustained by Mr Kamenjasevic and the impact that this has had on his life and that of his family. In his affidavit, Mr Walker expressed the impact that the incident had on him personally as well as on the employees of the defendant company. He said: Every day I try to accept the circumstances and gain closure on this tragedy, which to date I have not been able to do. My concerns are first and foremost for the continued improvement of Mr Kamenjasevic and subsequently, for the families of Fluid Tech and the chance for our survival following the outcome of the charge currently before the Court. I think about all of the issues and circumstances surrounding these entire proceedings every day and I do not think that will change. I know that my company is part of the accident, but me or my company are not the cause of it. 25The prosecutor seized on this last sentence to assert that Mr Walker on behalf of the defendant company had not expressed contrition in the sense that the company had caused the accident. It was said, on behalf of the prosecutor, that the penalty should not reflect the expression of contrition and remorse in terms of the cause of the incident. I accept the explanation given by the defendant's counsel that this last sentence was formulated in the context of the then outstanding issue about whether or not the defendant was under the impression that the hose supplied by Alfagomma was suitable for a high pressure oxygen line. At the time that the affidavit was sworn, there was no controversy concerning the defendant's acknowledgement of guilt with respect to the other particulars which cover a number of other omissions. I would not receive the final sentence of this paragraph as indicating a complete lack of remorse for the fact that the company had caused the incident. 26Submissions were made on behalf of the defendant that the Court should take into account that in effect it was a corporate manifestation of a partnership operating a small business. Financial statements tendered in the proceedings indicate that it has a turnover in excess of $2 million per annum, although, obviously, its net operating profit is much less than that amount. Furthermore, the defendant employs about 14 fulltime staff. It has been in operation for many years. No formal application was made that the Court take into account the provisions of s 6 of the Fines Act 1996 to justify some reduction in the penalty by reference to the defendant's capacity to pay. In any event, based on the evidence before the Court I would have rejected any such application. 27In all the circumstances, and having regard to the matters to which I have previously referred, I am of the opinion that an appropriate penalty is the sum of $95,000. 28The prosecutor sought orders for costs and a moiety. The defendant sought a costs order in its favour for that part of the hearing that dealt with the contested particulars, but did not resist the making of an order for the payment of a moiety to the prosecutor. 29In terms of costs, the only controversy revolves around whether or not the defendant should have a costs order in its favour with respect to the contested matter, or whether, as the prosecutor conceded, the prosecutor should not have his costs of the hearing of that matter, leaving the defendant to bear its own costs in that regard. 30I had occasion to consider the principles regarding the awarding of costs in prosecutions for a breach of the Act dealt with summarily in Inspector James v Ryan (No 2) [2010] NSWIRComm 63. I set out hereunder [5] to [7] of that judgment, which I intend should form the basis for a consideration of the controversial costs issue in these proceedings. [ 5] The circumstances in which orders for costs should be made in criminal proceedings conducted by a court of summary jurisdiction where a statutory discretion to award costs is available, have been the subject of consideration by the High Court of Australia in Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534. [6] I should observe at the outset that the power to award costs in the context of these proceedings brought under the Occupational Health and Safety Act is to be found in s 257C of the Criminal Procedure Act 1986 (NSW). The provisions of Part 5 of Chapter 4 of that Act apply to these proceedings. So much was uncontroversial. The parties agreed, also, that the principles discussed in Latoudis applied to the circumstances of these proceedings. [7] The substantial controversy which was determined in Latoudis concerned the proper approach to the exercise of discretion in awarding costs in favour of a defendant. The majority members of the High Court, Mason CJ, Toohey and McHugh JJ, approached the matter by concluding that a power to award costs conferred on a court of summary jurisdiction when a defendant is successful in the proceedings "must be taken to have intended to abrogate the traditional rule that costs are not awarded against the Crown." (Per Mason CJ at 542). Accordingly, a defendant who has been successful in having a criminal charge dismissed should in general terms be entitled to a costs order against the prosecutor. In exercising the discretion to award or refuse costs, the matter should be regarded by reference to the position of the defendant. The awarding of costs is intended to compensate a defendant for costs incurred in the defence of the proceedings and is not to be seen as inflicting some form of punishment on the prosecutor for having commenced the proceedings. McHugh J stated the matter in terms of a successful defendant having "a reasonable expectation" of obtaining a costs order. (At 566). 31Within the conduct overall of the proceedings, and notwithstanding an indicative plea of guilty, a controversy arose between the parties concerning a discrete issue. That issue was litigated and on the basis of the evidence given I found that the prosecutor had not established beyond a reasonable doubt the position contended for by him, and I upheld the position contended for by the defendant. That is, I found that notwithstanding the submissions of the prosecutor, at the time that the components were originally ordered from Alfagomma there was confirmation by Alfagomma that they were suitable for a high pressure oxygen line. It is true that I did not find that there was confirmation that the components would not put people at risk, but as the parties sensibly agreed, whether or not people would be put at risk would flow from their suitability for a high pressure oxygen line. Whether or not people would be put at risk by the failures referred to in the other particulars, namely (e), (g) and (h), was not relevant to the discrete matter that I had to determine. 32Accordingly, the defendant was successful in the litigation of this discrete issue. Having regard to the general principles to which I have referred, prima facie it should be entitled to its costs of those proceedings. I should add for completeness that in Latoudis the High Court of Australia discussed a number of matters that might disentitle a successful defendant to its costs against the prosecutor. They are referred to in general terms in [8] to [16] of my judgment in Ryan (No 2) . None of these matters apply to the circumstances of these proceedings. 33Accordingly, I propose to accede to the defendant's request for a costs order against the prosecutor confined to this discrete matter. 34At the conclusion of the hearing on 20 June 2011, I formally found the defendant guilty of the charge and convicted it accordingly. The Court then received from the prosecutor a Victim Impact Statement completed by Hasib Kamenjasevic. That statement outlines the severe injuries suffered by him both physical and psychological and the impact that this has had not only on Mr Kamenjasevic but also, understandably, on his wife, children and grandchildren. I have already noted the serious injuries sustained by Mr Kamenjasevic when dealing with the factual background to the proceedings and when considering the potential dangers associated with the use of high pressure oxygen lines.