Inspector Ochoa v Williams

In that case the Court substituted a compensation order of £100. 58 His Lordship concluded that "The costs and fine should be kept in step and the order as made should be within the means of the person so ordered". His Lordship concluded that the award of costs when coupled with the amount of the monetary penalty "was grossly excessive" and the matter was remitted back to the Court below for reassessment. 59 Glidewell LJ agreed. His Lordship commented that if the Court below did decide to make a fresh order for the payment of costs, the order should be "in the sum of £100 or £150 would seem to be appropriate." 60 This matter was again considered by an appeal bench of the Queen's Bench Division in R v Northallerton Magistrates Court Ex p Dove [2000] 1 Cr.App.R (S) 136. A defendant had been fined £1000 and ordered to pay the prosecution costs of £4624. He had a limited capacity to pay. 61 In his judgment, Lord Bingham CJ set out a number of principles, which his Lordship extracted after a consideration of a number of authorities. They are:

(1) An order to pay costs to the prosecutor should never exceed the sum which, having regard to the defendant's means and any other financial order imposed upon him, the defendant is able to pay and which it is reasonable to order the defendant to pay.

(2) Such an order should never exceed the sum which the prosecutor has actually and reasonably incurred.

(3) The purpose of such an order is to compensate the prosecutor and not to punish the defendant. Where the defendant has by his conduct put the prosecutor to avoidable expense he may, subject to his means, be ordered to pay some or all of that sum to the prosecutor. But he is not to be punished for exercising a constitutional right to defend himself. If it were otherwise, one would expect to find a right of appeal to the Crown Court under section 108 of the Magistrates' Courts Act . As it is, there is no right of appeal on the merits of such a costs order to the Crown Court, and a defendant's only right of recourse is on grounds of unlawfulness or excess of jurisdiction by case stated under section 111 of the 1980 Act or by way of a judicial review.

(4) While there is no requirement that any sum ordered by justices to be paid to a prosecutor by way of costs should stand in any arithmetical relationship to any fine imposed, the costs ordered to be paid should not in the ordinary way be grossly disproportionate to the fine. Justices should ordinarily begin by deciding on the appropriate fine to reflect the criminality of the defendant's offence, always bearing in mind his means and his ability to pay, and then consider what, if any, costs he should be ordered to pay to the prosecutor. If, when the costs sought by the prosecutor are added to the proposed fine, the total exceeds the sum which in the light of the defendant's means and all other relevant circumstances the defendant can reasonably be ordered to pay, it is preferable to achieve an acceptable total by reducing the sum of costs which the defendant is ordered to pay rather than by reducing the fine.

(5) It is for the defendant facing a financial penalty by way of fine or an order to pay costs to a prosecutor to disclose to magistrates such data relevant to his financial position as will enable justices to assess what he can reasonably afford to pay. In the absence of such disclosure justices may draw reasonable inferences as to the defendant's means from evidence they have heard and from all the circumstances of the case. I would draw attention to the proposition stated in the second volume of Dr Thomas' Current Sentencing Practice at paragraph J1-2G where it is stated: "It is the obligation of the offender to put before the sentencer any information about his means which he wishes the sentencer to take into account in determining the amount of the fine. If he fails to do so, the sentencer is not obliged to make enquiries on his own initiative."

I would also draw attention to the authority cited in support of that proposition: Wright (unreported, November 12, 1976). In the course of giving judgment in that case Lord Widgery C.J. said: "It is of course a fundamental principle of sentencing that financial obligations must be matched to the ability to pay, and there is an overriding consideration that financial obligations are to be subjected to that test. But that does not mean that the court has to set about an inquisitorial function and dig out all the information that exists about the appellant's means. The appellant knows what his means are and he is perfectly capable of putting them before the court on his own initiative. If, as happened here, the court is only given the rather meagre details of the appellant's means, then it is the appellant's fault."

(6) It is incumbent on any court which proposes to make any financial order against a defendant, whether by way of fine or costs, to give the defendant a fair opportunity to adduce any relevant financial information and make any appropriate submissions. If the court has it in mind to make any unusual or unconventional order potentially adverse to a defendant, it should alert the defendant and his advisers to that possibility. 62 In considering the factual circumstances that applied to those proceedings, Lord Bingham applied principle (4) extracted above. His Lordship concluded that the costs order was disproportionate to the amount of the fine and exceeded it "grossly". The proceedings were remitted to the Court below to reconsider the amount of the costs order. 63 The English authorities to which I have referred above emphasise that in each of the cases it was necessary to take into account the capacity of the defendant to pay. In each case, there was a question of impecuniosity or limited capacity. 64 There is a judgment of a single judge of the Queen's Bench Division that deals with circumstances where no question of capacity to pay arose. The case is BPS Advertising Limited v London Borough of Barnet [2006] EWHC 3335 (Admin). In those proceedings, Mr Justice Collins was considering a case stated by justices. The defendant had pleaded guilty to an offence relating to the placement of an advertisement without consent. It was fined the maximum penalty of £1000. It was ordered to pay costs of £7459.67. There was no question of incapacity to pay raised and the only question was whether or not the amount ordered to be paid for costs was disproportionate to the amount of the monetary penalty. 65 The statutory regime under which costs were payable is, relevantly, indistinguishable from that which applies to this Court namely that costs should be in such amount as the Court considered "just and reasonable." 66 Mr Justice Collins referred to the principles set out by Lord Bingham CJ in Ex p Dove, which I have previously extracted. 67 His Lordship then considered the material contained within proposition (4) as expressed by Lord Bingham and in applying it to the circumstances of the proceedings before him said:

[13] As Lord Bingham indicated, there is no question of an arithmetical relationship. On the other hand, one does inevitably look askance at an award of costs which is so much greater than the amount of the fine. I must bear in mind that the maximum fine in this case is £1,000. It may be that in a given case the cost of investigating and of prosecuting may be significantly greater than the maximum penalty that can be imposed. That should not in principle mean that an individual can get away with what otherwise is a criminal offence simply because it is too expensive to prosecute. The fact is that in most of these cases there is unlikely to be any issue that arises which can give rise to a significant complication and a significant outlay so far as costs are concerned. However, one has to recognise that Parliament has decided that a relatively small sum of money is the maximum penalty that can be imposed. Although the justices refer to this as a serious offence, one has to put that in the context of what the penalty for it can be. 68 His Lordship then examined the schedule of costs that had been submitted to the Justices at first instance and, after considering them, reduced the costs to £2250. 69 I immediately observe that in a strict sense, Mr Justice Collins has not applied the observations of Lord Bingham as set out in proposition (4). That proposition spoke of the relationship between costs and an actual fine imposed in the context of a consideration of a defendant's capacity to pay. In the circumstances before Mr Justice Collins, his Lordship was not troubled by any consideration of any question of capacity to pay. Furthermore, his Lordship assessed the disproportionate quantification of costs by reference to the maximum fine that could be imposed in the proceedings before him rather then by reference to the actual fine imposed. Obviously, where there is a maximum penalty of £1000, it may be permissible to have regard to proportionality of costs to penalty. However, the position is arguably distinguishable when regard is had to the quantum of costs by reference to an actual fine imposed. Here any question of a recognition that "Parliament has decided that a relatively small sum of money is the maximum penalty that can be imposed" becomes irrelevant. In Cahill v State of New South Wales (Department of Corrective Services) [2010] NSWIRComm 49, I had occasion to consider a submission made by the defendant that in fixing the amount of any penalty, the Court should take into account the fact that the defendant will have to pay the costs of the prosecutor. After reviewing relevant authorities, I concluded that there was no general principle which could be discerned from the authorities that would support such a contention. Relying on the approach of the Full Bench of this Court in Wilson, previously referred to, I concluded that any consideration of the fact that a defendant would be required to pay a penalty and costs was confined to circumstances where a defendant's capacity to pay was to be taken into account. My consideration of these matters is to be found at [59] to [72] and I again adopt the approach contended for in that judgment. 70 I conclude, having regard to the authorities to which I have referred, that the question of proportionality only arises in circumstances where it is appropriate to take into account a defendant's capacity to pay. Before leaving this topic, however, I should refer, with respect, to a judgment of Simpson J in the Supreme Court of New South Wales in Director General NSW Department of Agriculture v Temmingh [2003] NSWSC 598. The defendant had been found guilty of breaches of the Stock Medicines Act 1989. He was fined a total of $5000. The prosecutor sought an order for payment of costs of $44,132.95. No question of capacity to pay arose. 71 The matters that were put to her Honour to justify a reduction in the amount of the costs sought by the prosecutor were summarised by her Honour in the following manner:

[13] The defendant has also challenged the overall quantum of costs claimed on a broader basis - that, in global terms, it would not be just and reasonable to make an order of the magnitude claimed. In written submissions, the defendant's solicitor set out eight separate arguments in support of the challenge. These included the assertion that the defendant was frank in his interviews with investigating officers, something I found in his favour in the judgment; the plea of guilty; the quantum of the fines I specified would be imposed; the decision of the prosecutor to bring proceedings in the summary jurisdiction of this court, notwithstanding that it would have possible to prosecute the proceedings in the Local Court; the evidence given by the defendant that he was out of pocket in the sum of thirty or forty thousand dollars by reason of his participation in the events giving rise to the charges; the prospect that the defendant will face disciplinary proceedings by his professional body, putting himself at risk of further financial penalty; the costs incurred by the defendant and his defence, including retaining senior counsel for part of the proceedings; that the defendant is an individual and not a corporation. 72 Her Honour rejected all of the submissions and ordered that the defendant pay the costs of the prosecutor save for costs incurred in relation to the calling of one particular person as a witness. 73 Although there is reference to a challenge to the overall amount of costs on "global terms", it would appear that her Honour's attention was not directed specifically to any of the authorities to which I have referred. This may be because of the conclusion to which I have come, that they are to be applied only in circumstances where a defendant's capacity to pay is to be considered. 74 In the same manner, Preston CJ in the Land and Environment Court declined to disentitle a successful prosecutor to a costs order or to reduce the quantum of the costs because "the prosecutor ought to be compensated for the costs of bringing the prosecutions, which are in the public interest" notwithstanding the "modest means" of the defendant. See Plath v Chaffey [2009] NSWLEC 196. I should add that the evidence was that the defendant had assets of about $1500, no liabilities and his sole source of income was an allowance of $400 per fortnight from which he was required to pay living expenses, including rent. He was in poor health. His Honour concluded that the defendant would be unable to pay any fine "of any material amount" and in the circumstances determined to apply a community service order. Capacity to pay

75 It is now necessary to consider the defendant's capacity to pay to consider whether the principles of proportionality of costs to the penalty imposed should be applied. I have already set out in summary terms what is known of the defendant's financial circumstances in [22] above. The prosecutor has assessed costs at approximately $17,000. I have previously observed that the question of costs is a matter which is required to be taken into account in determining whether a defendant is entitled to consideration under s 6 of the Fines Act. As I have determined that I will not impose any monetary penalty, the question for determination is whether or not the defendant has a relevant capacity to pay the sum of $17,000 by way of a costs order. 76 The defendant submitted that his only ability to meet any costs order would be provided by increasing the mortgage on the family home. Whether and to what extent he is able to increase his borrowings will no doubt depend upon him satisfying the mortgagee of his capacity to service the additional debt given his evidence that he is currently struggling to make ends meet. In noting this, I take into account the need to care for his child who suffers from spina bifida. Of course, if the defendant is unable to borrow the additional monies, it might be necessary for him to sell the family home in order to raise the $17,000 necessary to pay the prosecutor's costs. Such a step would have its own drastic consequences in terms of the incurring of the costs of sale including agent's commission and the cost of acquiring another property, including stamp duty. These are all matters which would militate against ordering the payment of a substantial amount of costs. On the other hand, the defendant has breached the Act as manifested by his plea of guilty and, in the public interest, the prosecutor is entitled to a costs order. Any member of a community who commits an offence in circumstances where there is a prosecution will face the unpleasant consequences which are represented by adverse costs orders as well as the costs of any penalty. This is so whether the offence consists of a driving offence, a failure to lodge taxation returns or a breach of the Act. 77 Whilst I have great sympathy for the circumstances of the defendant and his family, I am not persuaded that it would be inappropriate to make a costs order in favour of the prosecutor against the defendant. Nor am I persuaded to arbitrarily reduce the quantum of those costs in the absence of any evidence that this defendant lacks a capacity to pay those costs by way of increased borrowings. I am conscious also that the WorkCover Authority of New South Wales has indicated publicly in other proceedings before this Court that it is always prepared to enter into negotiations with persons who are genuinely in need of some form of financial accommodation to allow either a penalty or costs to be paid off by appropriate instalments. 78 In all the circumstances, I would propose to order that the defendant pay the prosecutor's costs in an amount assessed in default of agreement but not exceeding, in any event, $17,000. Section 115

79 During the course of the proceedings, there was a discussion with both parties concerning the making of an order under s 115 of the Act in order to publicise the offence in these proceedings and in proceedings brought against East Sun, Mr Gao and Mr Mulder, which were all heard on the same day. The defendant, and the defendants in the other proceedings, agreed to submit to an order made under s 115 and to contribute between them the cost of complying with the order. 80 Section 115 of the Act is in the following terms:

(1) The court may do any one or more of the following: (a) order the offender to take specified action to publicise the offence, its consequences, the penalty imposed and any other related matter,

(b) order the offender to take specified action to notify specified persons or classes of persons of the offence, its consequences, the penalty imposed and any other related matter (including, for example, the publication in an annual report or any other notice to shareholders of a company or the notification of persons aggrieved or affected by the offender's conduct).

(2) The court may, in an order under this section, fix a period for compliance and impose any other requirements the court considers necessary or expedient for enforcement of the order.

(3) If the offender fails to comply with an order under this section, the prosecutor or a person authorised by the prosecutor may take action to carry out the order as far as may be practicable, including action to publicise or notify: (a) the original contravention, its consequences, the penalty imposed and any other related matter, and

(4) The reasonable cost of taking action referred to in subsection (3) is recoverable by the prosecutor or person taking the action, in a court of competent jurisdiction, as a debt from the offender. 81 The application of s 115 should be considered in the context of the objects of the Act, which are contained in s 3.

(a) to secure and promote the health, safety and welfare of people at work,

(b) to protect people at a place of work against risks to health or safety arising out of the activities of persons at work,

(c) to promote a safe and healthy work environment for people at work that protects them from injury and illness and that is adapted to their physiological and psychological needs,

(d) to provide for consultation and co-operation between employers and employees in achieving the objects of this Act,

(e) to ensure that risks to health and safety at a place of work are identified, assessed and eliminated or controlled,

(f) to develop and promote community awareness of occupational health and safety issues,

(g) to provide a legislative framework that allows for progressively higher standards of occupational health and safety to take account of changes in technology and work practices,

(h) to deal with the impact of particular classes or types of dangerous goods and plant at, and beyond, places of work. 82 In particular, s 3(f) is designed to facilitate the dissemination of information that will enhance community awareness of occupational health and safety matters. Whilst information given in a general sense is always useful, in my experience information about particular incidents and particular circumstances provides a more graphic illustration of the type of issues that may arise in practice. 83 I raised this matter with the parties because all agreed that the circumstances surrounding the incident which gave rise to these proceedings are frequently encountered within the building industry. This was a small residential construction site. The work was carried out solely by contractors, save for Mr Lin who East Sun acknowledged for the purpose of the proceedings was its employee. There were different levels of control. These ranged from the project manager to the principal plastering contractor down to the plastering subcontractor and the persons who were engaged by it. There were differing but concurrent obligations at each of these levels to comply with the provisions of the Act. Unlike the situation on large construction sites involving significant and substantial contractors and subcontractors with some degree of organisation and structure, there appears in the circumstances of this incident a significant lack of organisation and structure. Whilst it might be thought that the deployment of labour even on small building sites was a simple matter and that everyone would know what to do, the facts as revealed by these proceedings indicate that often the fact that no-one is injured is as much a matter of good luck as of good management. The situation was compounded by the fact that Mr Lin could neither read nor understand English and the only person who could communicate with him was Mr Gao. 84 Because it is clear that these circumstances are representative of what is happening in parts of the building industry, I intend making orders under s 115 of the Act. Those orders will be made in the same terms in each of the proceedings. The intention is that, as each of the defendants agreed, they would contribute between them up to $3000 for the placement of an advertisement in a number of newspapers circulating throughout New South Wales. 85 The WorkCover Authority of New South Wales helpfully provided information concerning those language newspapers in which such an advertisement might be inserted. They specified Mandarin, Cantonese, Korean and Spanish being "the nationalities which predominantly undertake work in the finishing trades in the construction industry." 86 I should add that the WorkCover Authority of New South Wales provided information that sets out the manner in which it currently communicates to culturally and linguistically diverse people. It conducts advertising campaigns in a number of publications and using also radio stations, media statements and releases placed on its website, which are undertaken in a variety of languages. It also publicises information to migrant service organisations. Furthermore, its construction team consists of inspectors who provide a number of language skills to assist its work in promoting safe work environments in the construction industry. 87 Because s 115 provides that the action to publicise the matters referred to must be "specified" and so as to avoid any doubt concerning the validity of any order made, I have drafted a form of advertisement which I intend being the subject of an order for publication. The publication would probably need to be confined to one only occasion in a newspaper having as wide a circulation as possible throughout New South Wales in English, Mandarin, Cantonese, Korean and Spanish. The advertisement is in the following terms:

Inspector Ochoa v East Sun Building Pty Ltd IRC 1212 of 2009 Inspector Ochoa v Williams IRC 1214 of 2009 and Inspector Ochoa v Mulder IRC 1215 of 2009 The WorkCover Authority of New South Wales charged three defendants with breaches of the Occupational Health and Safety Act 2000. Each pleaded guilty and each has been convicted of an offence under the Act. The Industrial Court of New South Wales has ordered that the defendants place and pay for this advertisement to warn others of the risks involved in residential house building sites. In these proceedings an owner builder used a project manager to arrange for renovation work to be carried out. The project manager used a contractor to do plastering work. That contractor used subcontractors to do that work. One of the subcontractors, in turn, used a number of persons who could not speak or understand English. Only that subcontractor could talk to them. One of these non-English speaking workers was working on some planks about three metres off the ground. A plank broke; he fell and was seriously injured. Neither the project manager nor the subcontractor had prepared a safe work method statement for this job. No one had organised proper scaffolding for this part of the work to be carried out. No one told the injured worker he should not have done the work that way. No one supervised him to make sure he did the work safely. The project manager, the head plastering contractor and the plastering subcontractor were all prosecuted and convicted of breaches of the Act. Anyone carrying out or involved in building work must make sure that all safety measures are taken and should get help from the WorkCover Authority of New South Wales if they are not sure of their responsibilities under the Occupational Health and Safety Act 2000. 88 Before making a final order under s 115 of the Act, I propose to stand the proceedings over. I ask each of the solicitors representing each of the defendants to liaise with each other concerning the placement of the advertisements and the costs. The intention of the Court is that each defendant will be required to contribute up to $1000 to a total expenditure of $3000. Obviously there will need to be some co-ordination of this activity. Perhaps the WorkCover Authority of New South Wales might provide some assistance in this regard. I note that that Authority has furnished to the Court and to solicitors acting for each of the parties a list of language newspapers in which the advertisement could be placed. I intend that the advertisements be published within six weeks of the date of this judgment. 89 I should emphasise that the Court expects that the solicitors concerned will attend to compliance with this order in a co-operative and cost effective manner. The Court is conscious that each of the defendants in the proceedings has financial constraints and that it would be inappropriate to overly burden any of the defendants with any further significant costs beyond those already incurred in connection with representation in the course of the proceedings. 90 I shall refrain from making any final order under s 115 and will grant liberty to apply. If the parties are able to reach some sensible agreement that will enable the advertisements to be placed in compliance with the court order, then my associate should be informed accordingly. Another purpose for the grant of leave is to allow any of the parties including the prosecutor to raise any significant objection to the advertisement as drafted by the Court. If the parties are able to reach agreement, I will issue a further order in Chambers without the necessity for further attendance. Otherwise, the Court expects that the liberty to apply will be exercised by the prosecutor within one month of this date. Orders 91 I make the following orders: 1. The defendant is found guilty of the offence with which he is charged and convicted accordingly. 2. The defendant is to pay the costs of the prosecutor in an amount assessed under the Legal Profession Act in default of agreement but not exceeding in any case $17,000. 3. The proceedings are stood over with liberty to apply to allow finalisation of the material that is to be subject to an order under s 115 of the Act.

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.