Inspector Hall v Gillespies Cranes Nominees Pty Ltd

Relevant Principles 8In considering penalty, I take guidance from the reasoning of the High Court in Markarian v R [2005] HCA 25; (2005) 215 ALR 213; (2005) 228 CLR 357 and their Honours' view that the task of sentencing must acknowledge the effect of the applicable legislative provisions (in this case ss 8(1) and 8(2) of the Occupational Health and Safety Act 2000 with ss 21A, 22, 23, 34 of the Crimes (Sentencing Procedure) Act 1999). The Court, using the "instinctive synthesis" approach, would include an assessment of the objective and individual subjective factors, with the appropriate weight given to each factor, and could (but not should) give a degree of deduction in penalty to some element in the consideration, in such circumstances as where it better serves the interests of transparency, which element should be narrowly confined (for example, the utilitarian value of the plea). 9Their Honours recognised the "instinctive synthesis" approach to sentencing gives rise to an inevitable tension between the need for transparency and adequate reasoning on the one hand, and the need to avoid a mathematical approach pursuant to which the sentencing court engages in a "staged sentencing process" starting at the maximum penalty and then making deductions from it without adequately assessing (even in a provisional way) the sentence called for by the objective facts (see Markarian at [32]). 10Spigelman CJ in R v Thomson; R v Houlton [2000] NSWCCA 309; (2000) 49 NSWLR 383; 115 ACrimR 104, correctly, given the consideration in Markarian , recognised this "instinctive synthesis" approach to sentencing saying at [57]: The instinctive synthesis approach is the correct general approach to sentencing. This does not, however, necessarily mean that there is no element which can be taken out and treated separately, although such elements ought be few in number and narrowly confined. As long as they are such, their separate treatment will not compromise the intuitive or instinctive character of the sentencing process considered as a whole. Proper regard is to be had to express legislative provisions and to the relevant statutory regime ( Markarian at [27]). 11The object of the Act is to protect employees from risk to safety, health and welfare whilst compelling attention to occupational health and safety issues so that persons are not exposed to risk to their health and safety at the workplace. In Inspector Morgenthal v Houghton [2010] NSWIRComm 192, the Court observed at [9]: In R v Way (2004) 60 NSWLR 168 it was emphasised that the provisions of the Crimes (Sentencing Procedure) Act ...are not to be construed as representing "a departure from settled principles of sentencing practice, or an abandonment of the discretion that is essential to any system calling for individualised justice". As was said at [59]: '[i]t is clear that the legislative policy ... so far as that can be discerned from the legislation itself, was not to create a straight jacket for judges ... but rather [was] intended to provide "further guidance and structure to judicial discretion.' 12Of relevance particularly is the effect of s 21A of the Crimes (Sentencing Procedure) Act 1999. Section 21A sets out factors that the court is to take into account in any sentencing hearing and states, inter alia : . . . (2) Aggravating factors . . . (d) the offender has a record of previous convictions, ... (g) the injury, emotional harm, loss or damage caused by the offence was substantial, . . . (3) Mitigating factors . . . (e) the offender does not have any record (or an significant record) of previous convictions, ... (g) the offender is unlikely to re-offend, ... (k) a plea of guilty by the offender (as provided by section 22) (l) the degree of pre-trial disclosure by the defence (as provided by section 22A), (m) assistance by the offender to law enforcement authorities (as provided by section 23) . . .

Consideration 13In a consideration as to penalty, the Court assesses the objective seriousness of the offence or, as has been said "the nature and quality of the offence". The Full Bench commented in Lawrenson Diecasting Pty Limited v WorkCover Authority of New South Wales (Inspector James Swee Ch'ng) (1999) 90 IR 464 ad idem with the view expressed in Markarian (at 474): ... in our view, it is important to reiterate that the primary factor to be considered when a judicial officer is determining the appropriate sentence to impose is the objective seriousness of the offence charged. In case of prosecutions under the OH&S Act, this proposition has often been expressed by saying that the "true measure of penalty lies in the nature and quality of the offence"... And in Morrison v Powercoal Pty Limited [2003] NSWIRComm 416 ; (2003) 130 IR 364 at [32]: In assessing the gravity of the offence the focus, therefore, must be on the risk and, viewing it objectively, the seriousness of the act or omission that gave rise to the risk, In other words, the consequence of an accident will not, of itself dictate the seriousness of the offence or the amount of penalty. However, the occurrence of death or serious injury may well manifest the degree of seriousness of the risk to health and safety to which persons may have been subjected ... 14Denham Constructions Pty Ltd (Denham Constructions) was the principal contractor retained to design and construct 65 industrial, retail "bulk goods" and high-tech units, together with the construction of associated car park and landscape works at the site. Denham Constructions contracted R & D Limited Partnership (R&D) to form and erect pre-cast concrete panels at the site. R&D contracted the defendant corporation to provide the crane and crane crew required to lift and place the pre-cast concrete panels into place at the site. 15The business at the relevant time employed approximately 50 - 60 employees, including about 3 employees who were directly involved in the incident, Mark Seagrott the crane driver; David Kennedy the dogman; and John Pearce the dogman . In addition, John Ackerman, undertook Site Supervision on behalf of the defendant and Paul Pearce was the defendant's workshop manager. It had approximately 19 working mobile cranes and hired out these cranes together with crane crews. The defendant had been contracted to provide a 250 tonne Liebherr mobile crane and crew to undertake the lifting and placement of tilt-up wall panels at the site. 16The under-slab propping system designed to support the weight of the crane on the concrete slab was a pair of Megashors, or backing-props, to be erected under the point on the suspended slab on which each of the four outriggers of the crane were to be placed. The tolerance, in relation to the placement of the crane's outriggers over the centre of the under-slab backing props, or Megashors, was 10mm. 17It was central to the design of the propping system that each outrigger be placed directly over the pair of props as placed or erected under the slab. 18The risk was the risk of people being struck or crushed by the crane, its lifting components, the load (the concrete panels) being lifted at the time of failure (if any), the slab on which the crane was positioned - as the slab failed - or the collapse of adjacent slabs and/or previously erected pre-cast concrete panels impacted upon by the failure of the slab and/or the crane following slab failure. The gravity of the potential risk to safety flowing from a breach is relevant as a measure of gravity of the breach and the culpability of the defendant ( Lawrenson Diecasting ). 19Denham determined it was necessary for the planned location of the crane to be moved because there was an electrical pit and plumbing on the underside of the ground floor slab so the prop would not hold the weight of a crane's outriggers. Mr Arthur Nehme, the site foreman for R&D, and Mr Vella of R&D, the controlling mind of R&D, (both partners of the partnership) were both aware that a change of location for the crane was to occur. The change in set-up location was not marked out on an amended casting layout drawing or Panel lay-out plan for the site. 20Mr Goronwy, the Denham Construction's site foreman, marked the top at the point of the slab aligned with each of the under-slab backing props at the new location. Mr Goronwy then had the markings for set up approved by Paul Sinclair, Denham Construction's site supervisor. Once Mr Goronwy had marked-up the outrigger locations he showed those markings to Mr Nehme of R&D who had sub-contracted the use of the crane. However, the slab was now marked with two sets of points (or mickey pins) and yellow markings: one set of 4 point-pins and yellow paint corresponded with the initial, planned set-up point and then a second set of 4 point-pins and yellow paint was put on the slabs which corresponded to the "new" set-up point. 21After Mr Goronwy (of Denham) showed Mr Nehme (of R&D) the new set-up points/markings Mr Nehme showed the crane crew the new markings and then he oversaw the movement of the crane into place and the lowering of each of its four outriggers onto the slab. The points onto which each outrigger was lowered was neither directly aligned with, nor supported by, a set of under-slab backing props. 22Further, neither Denham Constructions, nor R&D Panelform, nor Gillespies checked to confirm the proper placing of the outriggers on the props. 23On 26 September 2008, at about 10 am EST, the right rear outrigger of the crane punched through the suspended slab whilst the crane was undertaking the lifting and placement of a pre-cast concrete panel. Approximately one hour later, a second slab collapse occurred , when the panel that the boom was resting on collapsed , and the rear of the crane continued collapsing through the first floor slab until the rear of the crane came to rest on the ground. 24It is common ground that no-one was killed or sustained serious injury as a consequence of the collapses. The hazard posed by the crane collapsing extended beyond the crane exclusion zone which was in place at the time and created a risk which encompassed a number of employees from the various corporations who were on site at the time of the first collapse. 25When the defendant corporation moved to this site the slab was marked with paint showing the path where the crane could be driven and where the crane was to be set up. Mr Graham Ackerman, Gillespie's Site Supervisor, attended the site prior to commencing work to investigate the site conditions. Other than the suspended slab, he did not report anything unusual or out of the ordinary for this site. The defendant provided R&D with the crane dimensions and the maximum loading of the crane and outriggers to be used during the lifting process. 26The travel path for the crane and outrigger positions were marked out in advance so that when the Gillespies crane crew arrived on site, both the travel path and the outrigger positions were identified without any setting out required from Gillespie's employees. Usually Gillespies use large outrigger steel support pads under the outriggers so that if there is a slight discrepancy between the propping underneath and the outriggers on top, the support pads give greater support to the weight of the crane with outriggers. The defendants were instructed by R&D not to use large outrigger support pads. 27The defendants were working under the Principal Contractor's Safe Work Method Statement and its men were inducted on site by the Principal Contractor, Denhams. The defendants therefore relied upon third parties to ensure the marks were set out in the correct position and were instructed by R&D and Denhams to set up the crane in the particular position. 28R&D had identified in its SWMS the use of a surveyor to confirm the safety at each set-up point before lifting commenced which required an assurance that the crane's outriggers , as positioned on top of the suspended slab, were aligned with the backing props. A surveyor did not check the location of the crane prior to the commencement of the lift. 29The defendant corporation was aware of the risk and of the need for relevant controls to be put in place. The defendant's SWMS nominated an "[e]ngineer's certificate be sighted by the crane crew prior to lifting". No engineering inspection took place and no certificate was sighted prior to the commencement of the lift. 30The defendant relied upon verbal communications and gestures from Mr Nehme of R&D for the purpose of communicating the location of set-up marks as placed on the slab and made no provision for independent verification of the location of the crane, above the under-slab backing props, before lifting commenced. 31The principle of foreseeability is a factor in determining the objective seriousness of an offence. This was considered and affirmed by the Full Bench decision in Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 . On the issue of foreseeability, the Full Bench in Capral stated at [82]: The existence of a reasonably foreseeable risk of injury will necessarily result in the offence being more serious in nature. However, the absence of foreseeability does not necessarily render the offence as being nominal or not serious. In this regard the relevant approach is that set out in the judgment of Wright J, President, in Ferguson v Nelmac Pty Ltd (at 209-210) in these terms: ... reliance on 'hindsight' must be seen in an appropriate perspective in terms of culpability. It is a relevant consideration but the very terms of s 15 impose an obligation on an employer which is not confined to the taking of precautions only when there are warnings or signals of danger or when experience indicates that a risk to safety has arisen and requires remedy. In the circumstances of this case there was a foreseeable element to the breach which makes it more serious. The defendant accepts there was a foreseeable element to the offence. It did not supervise either the placement of the crane nor require the independent check on the alignment of the outriggers with the props. This admission is commendable. 32The availability of simple and straightforward steps to remedy the defects in the system is also relevant to the consideration of the objective seriousness of the offence ( WorkCover Authority of New South Wales (Inspector Ch'ng) v ACI Operations Pty Limited, unreported decision of Schmidt J dated 25 February 1994). There were known steps that could have been taken which, either singly or in combination, would have eliminated or reduced the risk. These steps have now been implemented by the defendant. Such activity after the incident is indicative of the fact each amendment to the system of work was readily available and practicable. 33The principles of general and specific deterrence are also relevant in sentencing considerations. The approach to be taken has been considered in some detail in Capral at [71] - [77]. Each approach to deterrence in the sentencing process is encapsulated in the following passage from the Full Bench at [74]: ... both aspects of deterrence are matters which should normally be given weight of some substance in the sentencing process; and although there may be exceptional cases (see, for example, Page v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39 at [40] - [43]) we would expect such cases to be very rare, and where the relevant circumstances were held by the sentencing judge to be established, the judge must indicate with some precision the circumstances which had led to the exceptional course being adopted. 34The defendant's business in its present form has been in operation since 1979 but has operated in the construction industry since the 1950's. It has an unblemished industrial record. Further, since the incident it uses large support pads over underneath propping; ensures engineers and surveyors inspect a site for each and every set up and its required documentation confirming that the set ups are correct and its job sheets now specifically address the type of surface the crane is to be set upon. 35Its new internal checklist was provided by Mr Gillespie, the director and the controlling mind of the corporation, to the Crane Industry Association of NSW as a suggestion to be implemented throughout the industry. It was refined, developed and distributed throughout the industry. The defendant corporation adopted the Crane Industry Association of NSW checklist on procedures for cranes on suspended surfaces. Its SWMS is now more comprehensive including specific reference to working on a suspended slab as follows: Working on suspended structure checklist to be completed prior to commencing works. Crew to confirm set up is correct with Principal Contractor. If permit not supplied, abort operation until a full assessment of the proposed new set up location or travel route has been carried out. Where Engineers Report to be modified, amended or replacement report must be obtained prior to commencement of work. Toolbox talk to denote consultation between relevant parties. 36The defendant no longer relies upon third parties to ensure a safe set up of its cranes. Nonetheless the defendant continues to operate in the construction industry so there shall be a small element of specific deterrence in the Court's consideration of penalty. 37As to general deterrence, Mr John Gillespie is the Managing Director of Gillespies Cranes Nominees Pty Ltd. He is also President of the Crane Industry Council of Australia (CICA) and has held that position for a total of approximately 13 years. On behalf of CICA he signed the World Crane & Transport Alliance in 2009. The signatories to this Alliance foster efforts throughout the industry worldwide to promote safety and harmonise standards worldwide. In the last twelve months he has been involved with the International Crane Technical Liaison Group working toward the harmonisation of world standards for mobile cranes so that safety and crane standards are international rather than locally based to enable cranes to meet criteria to work around the world. The members of both organisations are attempting to amalgamate. He has represented CICA on the Industry Plant and Consultative Committee. This is a tripartite arrangement between the Master Builders Association of New South Wales, WorkCover Authority and the Construction Forestry Mining Energy Union (CFMEU). As President of CICA, Mr Gillespie has, for the past twelve months, been on the executive committee of the Construction Industry Safety Forum which is a New South Wales based organisation which was set up by the New South Wales construction industry, CFMEU and Workcover. 38Two important initiatives that Mr Gillespie has been instrumental in driving and developing is the Traineeship scheme and the annual safety inspection for cranes as part of the registration renewal. In such a circumstance Mr Gillespie, as the controlling mind of the corporation, has personally contributed his energies and experience to ensure there is awareness within the crane industry of the need for rigorous safety procedures. He has openly demonstrated to the industry the refinements which have been required in the operation of his own safety conscious business and corporation. In such a circumstance, I accept Mr Gillespie has himself reminded the crane industry of the need for rigorous review of its SWMS and the need to ensure they are implemented, especially where there are major construction sites which require the co-ordination of SWMS and the co-operation between corporations on site in their implementation. In this case, the corporate defendant, under his guidance, allowed a third party, the head contractor, to override the necessity for an independent engineering check which variation to the defendant's SWMS had the most serious of consequences. However, I accept the corporation has, with Mr Gillespie, been the voice of safety in the crane industry over many years and has instigated much of the industry's safety procedures. There will be but a small element of general deterrence in the Court's consideration as to penalty. 39Pursuant to s 21A(3)(k) of the Crimes (Sentencing Procedure) Act the defendant is entitled to have its pleas of guilty taken into account in the assessment of the sentences to be imposed on it by the Court as a factor in mitigation of penalty. The defendant is entitled to a discount on each penalty flowing from the utilitarian benefit of each plea in accordance with the principles outlined in the guideline judgment of the Court of Criminal Appeal in R v Thomson; R v Houlton (2000) 49 NSWLR 383. The discount in respect of the utilitarian value of the plea is offered in recognition of the practical advantages to the administration of justice. The prosecutor concedes that there are no factors which would operate to disentitle the defendant to the full value of the utilitarian benefit of its pleas. There shall be a 25 per cent discount for the utilitarian value of the plea. 40In Cahill v State of NSW (Department of Community Services) (No 4) [2008] NSWIRComm 201 at para 62 Boland P said: A simple expression of contrition or remorse by a representative of a corporate offender, no matter how senior the representative, is not enough to enable the Court to find that the offender is remorseful: As Cummins J said in DPP v Esso Australia Pty Ltd [2001] VSC 263; (2001) 124 A Crim R 200, "personal expressions of remorse need to be translated into reality". See also see Regina v Heip Tan Nguyen [2004] NSWCCA 438 per Bell J ( Hidden and James JJ agreeing) at [21]. There must be 'evidence that the offender has accepted responsibility for its actions and also that the offender has acknowledged any injury, loss or damage caused by its actions or that it has made reparation for such injury, loss or damage (or both)'. In this regard, s 21A(3)(i) of the CSPA provides that "remorse" may be taken into account as a mitigating fact if and only if: (i) the offender has provided evidence that he or she has accepted responsibility for his or her actions, and (ii) the offender has acknowledged any injury, loss or damage caused by his or her actions or made reparation for such injury, loss or damage (or both). 41I accept there has been the appropriate expression of remorse through Mr Gillespie and he has made reparation through his activities within the industry councils. He has accepted responsibility. 42The defendant co-operated in the investigation by WorkCover of the subject incident. The defendant has co-operated with the prosecutor in relation to the preparation of the related prosecutions. 43The defendant is not previously recorded and the prosecutor acknowledges that the Court may extend to the defendant the leniency normally extended to "first offenders". 44The absence of any breach of occupational health and safety standards and obligations over such an extended period is taken by the Court to be representative of a strong commitment to occupational health and safety, particularly, in light of the dangerous nature of the construction industry. The high level of involvement, locally, nationally and internationally, in the development of the occupational health and safety initiatives is commended and the defendant corporation has the benefit of its prior good industrial citizenship in mitigation. 45The duty owed under s 8(1) of the Act and the duty owed under s 8(2) of the Act, whilst co-extensive, are duties owed to different classes of person. 46Their observations of the "plurality" in Kirk v Industrial Relations Commission of New South Wales [2010] HCA 1; 239 CLR 531 regarding the nature of the obligation created by s 15(1) and s 16(1) of the 1983 Act , it is submitted that the overlapping duties imposed by s 8(1) and s 8(2) of the 2000 Act, respectively, are a duty "to ensure" and may be properly characterised as a duty to guarantee or secure health, safety and welfare: Carrington Slipways Pty Ltd v Callaghan (1985) 11 IR 467 at 470; the duty is higher than the common law duty to take reasonable care; the duty is non-delegable in nature . 47However, a simple comparison of the particulars as between the s 8(1) and the s 8(2) charge brought discloses an overlap of criminality. As a matter of principle, it is accepted by the prosecutor that it would be proper for the overlap in criminality to be reflected in an adjustment by the Court of the "total penalty" to be imposed on the defendant. 48It is common ground that the facts and circumstances giving rise to the charges laid against the defendant corporation presently before the Court also gave rise to two charges, in similar terms, alleging contraventions of s 8(1) and s 8(2) of the Act being laid against R & D Panelform (NSW) Pty Ltd and Denis Charles Vella - each as partners in R & D Panelform Limited Partnership - and Denham Constructions, the principal contractor. 49The principles of "parity in sentencing" apply in respect of a "class of offenders" across the range of a single offence and recognise the need for consistency in the sentencing of offenders charged with the same offence ( R v Tiddy (1969) SASR 575 at 577) : Where other things are equal persons concerned in the same crime should receive the same punishment, and where other things are not equal a due discrimination should be made. [Emphasis added.] 50While the principles of parity have no application as between the defendant presently before the Court for sentence and/or Denham Constructions and/or R & D Panelform (NSW) Pty Ltd and Vella, nonetheless there is a need for consistency in sentencing as between offenders charged with differing offences under the Act where offences arise out of the same factual matrix. There will be differences in sentencing outcomes which will reflect the differences in the circumstances between offenders and differing roles of defendants and differing levels of criminality must also be taken into account and properly reflected in the respective penalties to be imposed: Signanto v The Queen (1998) 194 CLR 656 at 670. 51In a consideration of the contribution to the risk by the principal and other contractors it is noted Denham Constructions also contributed to the risk when it assumed control of the erection of the backing props and the marking up of each set up location. R &D contributed to the risk when it assumed responsibility for provision of immediate, on site supervision in relation to the location of the crane at each set up point. 52The defendant corporation, however, determined the work method to be followed by its own employees, including a requirement that its crane driver sight an engineer's certificate before commencing lifting; and the defendant failed to ensure that provision was complied with or some other alternative, verifiable method was used to confirm, at each set-up, the alignment of the crane outriggers and the under-slab back propping which the defendant erected. 53While there are subjective elements allowing mitigation of penalty, nonetheless the seriousness of the offence must be reflected in penalty. I do not accept Gillespies level of penalty in the circumstances is equivalent to that carried by the other defendants who have faced charges arising from this incident. 54In Matter No. IRC 1064 of 2010, the charge under s 8(1) of the Act, I find the defendant guilty. The defendant is fined in the sum of $80,000. 55In Matter No. IRC 1057 of 2010, the charge under s 8(2) of the Act, I find the defendant guilty. The defendant is fined in the sum of $80,000. 56In the application of the principle of totality, the fine for the offences shall be $100,000. 57Therefore, for each offence, the defendant shall be fined $50,000.

Orders 58The Court makes the following orders:

1. In Matter No IRC1057 of 2010, I find the defendant guilty of the offence as charged.
2. The defendant is fined in the sum of $50,000 with a moiety to WorkCover Authority of New South Wales.
3. In Matter No IRC1064 of 2010, I find the defendant guilty of the offence as charged.
4. The defendant is fined in the sum of $50,000 with a moiety to WorkCover Authority of New South Wales.
5. The defendant is to pay the costs of the prosecutor. There has been no agreement between the parties as to the quantification of the costs. I will hear the parties on this issue in the event no agreement can be reached. Leave to re-list at short notice. 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: 16 December 2011