Inspector Wade v Goldspring's Earthmoving Pty Ltd

Objective seriousness of the offences 13The risk was identified in the amended charges as the risk of being hit or struck by the excavator. This risk was both obvious and well-known within the industry in which the corporate defendants operated. The excavator, as an item of mobile plant, was travelling in a reverse direction on the railway line with restricted visibility. Three teams of workers were working on the same railway line at the time. The WorkCover Code of Practice, "Moving Plant on Construction Site" ("the Code of Practice"), came into effect on 16 January 2004. It applies to the use of moving plant (such as the excavator) at construction sites and places of work in New South Wales, except mines. It defines "construction work" as including several engineering works, such as the construction, structural alteration, repair, and maintenance of "railways". In the Agreed Facts document tendered during the sentencing proceedings the risks of injury associated with the use of mobile plant, such as the excavator, identified and discussed in the Code of Practice are set out as follows: The risks of injury to pedestrian/ground workers within "construction sites" associated with the movement of mobile plant are discussed at length in the code of Practice and particular note is made to the risks to pedestrian and ground workers within construction sites associated with reversing plant. (See: Chapter 3 page 10) In Chapter 3.3.3 controls for pedestrians near moving plant is observed that, where practicable, plant should always be operated in a forward direction and the use of a spotter is identified in the context of insuring that no persons are at risk before plant reverses. 14Chapter 3, section 3.2 of the Code of Practice states, in part: Vehicle movement procedures should be developed based on the risk assessment and should be updated each time conditions on the site change in a way that may affect the health and safety of persons at the workplace. It should also include an assessment of the visibility of plant and traffic from all areas of the worksite. The use of specific measures to eliminate or control identified risks should be done on the basis of the risk assessment. In particular, consider the following: isolating vehicles and plant used in and around the site and work area from persons on the site or work area. For example, vehicle or persons may be guided around or pass the work area; planning for the direction that plant moves, so that the visibility of operators is not restricted; using spotters/safety observers to control traffic movement. 15At the time of the offences, John Holland Pty Ltd and John Holland Rail Pty Limited (henceforth referred to collectively as John Holland) controlled the Sandgate site and the works being performed at the site. The nature of the work being undertaken at the site at the time of the offences was construction work which fell within the definition in the Code of Practice. According to Mr Goldspring, in his affidavit of 25 March 2011, when plant, equipment and operators were supplied to John Holland by the corporate defendants, the corporate defendants were required to meet John Holland's occupational health and safety procedures which included site inductions, safe work method statements, plant hazard risk assessments and operator competencies. Mr Goldspring explained that when the corporate defendants' operators attended John Holland sites they were generally supervised and directed by John Holland personnel on a day-to-day basis, even though they remained employees of Earthmoving and even though Earthmoving had ultimate control over those employees. According to Mr Goldspring, Goldspring and Sons regularly provided John Holland with safe work method statements. Mr Goldspring was unable to produce a safe work method statement which had been provided to John Holland at the time of the offences, although he believed one would have been provided. 16According to the Agreed Facts, John Holland, pursuant to a contract with Australian Railtrack Corporation (ARTC), undertook to comply with the Code of Practice at the site. According to that contract, John Holland was to develop and enforce both a project OHS&R management plan and a site specific management plan. Part of its contractual obligations were to ensure compliance by sub-contractors with both plans, which included ensuring that all sub-contractors had in place, and were complying with, safe work method statements that satisfied the requirements of the Act and the Occupational Health and Safety Regulation 2001 (the 2001 Regulation). John Holland was also obliged under the contract to conduct pre-work safety briefings for all its employees and sub-contractors on site at the commencement of each shift and when work conditions changed. It was also obliged to discuss with all employees and sub-contractors on site any site specific hazards and all safe work method statements associated with the work activities scheduled during the day, as well as informing all employees and sub-contractors on-site of preventative measures and procedures to be adopted to control or eliminate those hazards. 17None of the foregoing steps which John Holland was required to take, however, were followed with regard to the corporate defendants in these proceedings, in particular as regards the operation of the excavator and its proximity to the ground workers which included Mr Stalder and Mr Todd Faux. 18On 27 September 2006, Mr Goldspring completed an ARTC waiver form with respect to the operation of the excavator at ARTC work sites. In the form, Mr Goldspring indicated that the excavator was fitted with the following relevant equipment: flashing orange light; horn. 19Mr Goldspring also asserted that the machine complied with the relevant ARTC standards. 20As the facts outlined earlier reveal, Mr Goldspring had identified some defects in the excavator while using it five days before the incident that gave rise to the offences. The defects had not been attended to at the time the excavator was operated at the site at the time of the incident. In addition, Mr Marshall had been trained and obtained certification as a competent track machine operator (TMO). The day of the incident was the first day in which he had operated the excavator. His training in regard to the excavator was limited to a demonstration of its functions provided by Mr Goldspring prior to the offences. 21According to the Agreed Facts, Earthmoving relied entirely upon John Holland for the provision of relevant safety controls, safe work methods and the provision of supervision. With regard to the provision of supervision, all defendants acknowledge that it was inadequate on the day of the offences. 22As a result of the offences, Mr Stalder sustained severe injuries to his left arm. In the circumstances of the incident, the risk of a fatality was not unlikely. 23Given these considerations, the Court concludes that the offences were serious. In summary, the following factors underscore this conclusion: the risks of mobile plant colliding with ground workers on construction sites, particularly reversing vehicles, and more so mobile plant with restricted visibility in the direction of travel while reversing were obvious and were well-known in the industry prior to the incident; the corporate defendants were aware of the need to ensure that the excavator was fitted with safety equipment, including an operable rotating beacon, an operable reversing or motion alarm, UHF radio communication equipment, and reversing mirrors that provided an adequate view to the rear of the machine; engineering controls, such as truck stops or barriers were also well-known in the industry prior to the incident; administrative controls, such as the use of spotters and minimum safe working distances were also well-known in the industry before the incident; in the event of a collision with a ground worker, the prospect of serious injuries, including a risk of a fatality, was not unlikely. 24General deterrence is an important factor to be taken into account. It has sought to be emphasised many times in this jurisdiction that construction sites are notorious for both the seriousness and frequency of injuries which occur as a direct result of hazards present at a particular site or because of the absence of safe work practices or as a result of unsafe work practices which are left unaddressed. The potential dangers posed by large and heavy machinery, such as the excavator, operated at construction sites, should not be overlooked. This is particularly important in circumstances where a common feature of any construction site is the presence of a large and disparate workforce consisting of workers new to, and unfamiliar with, the site. It is the responsibility of all employers at such sites to protect workers from hazards present at the site and to address any unsafe work practices which have the obvious potential to expose the workers to the risk of serious injuries. 25Specific deterrence also falls for application but only in relation to Mr Goldspring who continues to operate as a director of two corporations which operate in the construction industry. With regard to these two corporations, the respective businesses of the corporate defendants were transmitted to them, following restructuring. In relation to Earthmoving, this occurred in June 2008 with the incorporation of Goldspring's Earthmoving & Heavy Haulage Pty Ltd. In relation to Goldspring & Sons, this occurred on 20 December 2007 with the incorporation of Goldspring's Equipment Hire Pty Ltd. Although the two corporate defendants are still in existence their respective business operations are conducted through the new corporate entities. 26None of the defendants have prior convictions. The corporate defendants therefore face a maximum penalty of $550,000 and Mr Goldspring, a maximum penalty of $55,000.

Subjective factors 27All the defendants entered pleas of guilty to the original charges on 3 June 2009. It was conceded by the prosecutor that the defendants' pleas of guilty to the amended charges were entered at an early stage. This was said to be because the effect of the High Court judgment in Kirk v Industrial Relations Commission; Kirk Group Holdings Pty Ltd v WorkCover Authority of New South Wales (Inspector Childs) [2010] HCA 1; (2010) 239 CLR 531 ( Kirk ) invoked the necessity to file amended charges in all matters. The Court was not invited to examine the original charges in order to ascertain for itself whether the charges as originally drafted satisfied the requirements in Kirk for validity. Accordingly the Court is prepared to accept the prosecutor's submissions and the defendants will receive a discount of 25 per cent reflecting the utilitarian value of the pleas. 28Mr Goldspring, on his own behalf and as a director of the corporate defendants, also demonstrated remorse for his role and the role of the corporate defendants in the circumstances of the offences. In his affidavit of 25 March 2011, Mr Goldspring expressed his deep remorse and his friendship with Mr Stalder: I have known Caleb Stalder (Will) since approximately 2002 and I have worked with him from time to time throughout his employment with John Holland. I had a great relationship with him and I have still have a deep sense of remorse and find it extremely hard to deal with what had happened to him by the involvement of our excavator. I have kept up to date with Will's medical condition and still do today. My major concern at the time was that Will would not lose his arm. I spoke to him a number of times in 2006 and 2007 after the incident and reassured him that my only concern was that Will's arm be saved and that nothing would come between Will's and my friendship due to this accident. I have continued support to Will and have offered any/or all support that he requires to get through his injury. So far he has not taken me up on any such offers. 29The issue of remorse is satisfied for the purposes of s 21A(3)(i) of the Crimes (Sentencing Procedure) Act 1999 (the CSPA) by evidence of prompt action taken by the defendants following the incident to address safety matters. These matters are set out in Mr Goldspring's affidavit of 25 March 2011, extracted below: After the incident in November 2006 I took steps very quickly to enforce our company policies and safety measures generally when our employees did work at sites controlled by host employers. I caused Goldsprings to issue further memos to each employee or contractor engaged to work on the John Holland site, this was notwithstanding we had issued earlier memo's regarding the need to follow John Holland procedures before the incident. I corresponded with operators and transport drivers about attending host sites. Annexed is a copy of a memo I issued to each operator and transport driver engaged to work on the John Holland site. Since then there have been no further safety incidents. 30Following the commission of the offences a new version of a Safety Management System which includes an Occupational Health, Safety and Welfare Policy was developed for Earthmoving & Heavy Haulage Pty Ltd, the corporate successor to Earthmoving. 31The defendants are not adversely recorded, which entitles them to leniency. The absence of prior convictions also illustrates the defendants' good industrial history given that they have operated in the construction industry since the early to mid 1990s. 32The passage extracted earlier from the affidavit of Mr Goldspring also demonstrates that the defendants offered assistance to Mr Stalder. 33Mr Goldspring's affidavit of 25 March 2011 also discloses that he and his brother, Mark Goldspring (also a director of the corporate defendants at the time of the offences), have contributed to their local community in various ways conveniently set out in the affidavit: During the past 20 years Mark Goldspring and I have contributed greatly to the community in which we live. We have been involved in motor sport, football, soccer, rodeos, and several local fund raising events which we still support today. We have sponsored the Paterson River Football club, Hinton Hornets Football club, Weston Soccer Club, Hawks Nest Nippers Club, Maitland Hockey Club, the Transport Awareness Association, various Rodeo participants being bull riders, horse riders, motorcycle riders, speedway driver and supported sick and cancer suffering children. 34All of these subjective factors will be taken into account in mitigation of the penalties to be imposed.

Respective roles 35The evidence reveals, and the charges reflect, that Goldspring & Sons had a more limited role in the circumstances of the offences than did Earthmoving. The culpability of the former corporate defendant is confined in the charge to the defects in the excavator. In contrast, the culpability of Earthmoving includes an allegation concerning the defective excavator (by permitting it to be operated at the site in its defective state), as well as its failure to ensure various administrative controls were implemented at the site. These include its failure to ensure a safety inspection was performed of the excavator; its failure to ensure the excavator was operated safely at the site; its failure to ensure that a spotter or a safety observer was assigned to observe the movements of the excavator and the ground workers; and, its failure to ensure that its employee, Mr Marshall, was provided with a safety briefing before operating the excavator. These matters compel the conclusion that the culpability of Goldspring & Sons is less than that of Earthmoving. This was conceded, quite properly, by the prosecutor. 36In relation to Mr Goldspring's culpability, the issue is somewhat problematic. At the time of the offences, he was one of two directors of each corporate defendant. Little is known on the evidence about the role and functions of the other director, Mr Mark Goldspring. The evidence, such as it is, indicates that the two brothers took over the business at some stage. It was submitted by counsel for the defendants, Mr Easton, that Mr Goldspring was not the alter ego of the corporate defendants because he was not, "the only person ... capable of doing it". I infer from this that Mr Goldspring was not, at the time of the offences, the only person within the corporate structure making relevant operational decisions. It was conceded by counsel for the prosecutor, Mr Cahill, that there was no basis on the state of the evidence to conclude that Mr Goldspring was the alter ego of either corporate defendant. Although the evidence is obviously not entirely satisfactory, I am prepared to find, on the available material, that Mr Goldspring was not the only person within the corporate defendants' structure capable of making decisions of an operational nature. It follows that Mr Goldspring's role in the circumstances of the offences may be described as less than that of the corporate defendants: see generally on this issue WorkCover Authority of New South Wales (Inspector Page) v Walco Hoist Rentals Pty Limited and Another (No 2) (2000) 99 IR 163 at [38], [39] per Wright J, President. 37The culpability of each defendant also falls for assessment by reference to the role of John Holland as the controller of the site. John Holland's role at the site has been earlier referred to in these sentencing reasons. Both Mr Stalder and Mr Todd Faux were employed by John Holland Rail Pty Ltd on the day of the offences. The two corporate entities, collectively referred to for convenience in these proceedings as John Holland, have also been charged and have entered pleas of guilty in relation to their respective roles at the site. 38According to the Agreed Facts, John Holland had developed a Worksite Protection Plan which was to be used in conjunction with a site safety system. This latter procedure included the following safety controls: detailed job safety analyses with respect to the performance of tracklaying and track work (including assembling turnouts and catch-points) for the Sandgate project; detailed safe work method statements (including a safe work method statement developed with respect to the subject shutdown including Worksite Protection); and daily Pre-Work Rail Briefings. 39Additional features of John Holland's safety system are recorded in the Agreed Facts as follows: John Holland's relevant safe working systems and methodology recognised the need for all mobile plant, including excavators, to be fitted with: Rotating beacons; Motion alarms; and UHF radio communication equipment. John Holland's systems recognised the need for communications to be maintained between mobile plant operators and ground workers (" ground level labour "). John Holland's systems also recognise the need for plant to undergo "pre-start checks" for faults and also to ensure that all such plant was fitted with rotating beacons and motion alarms. John Holland's systems identified the need to maintain a safe working distance (of not less than 5 metres) from track machines such as the Kobelco SK 60 Hi Rail excavator. The safety controls set out above were to be the subject of a daily pre-work briefing. 40According to the Agreed Facts, none of the precautions set out in John Holland's system were enforced at the site on the day of the offences. 41John Holland, according to the Agreed Facts, also undertook to comply with the National Code of Practice for the Construction Industry and to include a requirement to comply with the Code in all sub-contracts. 42A number of John Holland's contractual obligations, relevant to the safety of its employees and sub-contractors at the site, have been conveniently set out in the Agreed Facts as follows: Pursuant to clause 3 of Schedule 4 to the Sandgate Rail Grade Separation Project Contract, Project Contract No CW - NSW - 29, John Holland Pty Ltd was to develop and enforce both a Project OHS&R Management Plan and a Site Specific Management Plan. John Holland Pty Ltd contracted to ensure compliance by sub-contractors with its OHS&R Project Management Plan and its Site Specific Management Plan, including ensuring that any sub-contractor had in place and was complying with safe work method statements that satisfied the requirements of the Occupational Health and Safety Act 2000 and the Occupational Health and Safety Regulation 2001. [See: Clause 3 to Schedule 4 of the Contract.] Pursuant to clause 4(a) of Schedule 4 to the Contract, John Holland Pty Ltd was to conduct pre-work safety briefings for all its employees and subcontractors on site, daily at the commencement of each shift and when work conditions change. Pursuant to clause 4(a) of the Contract, John Holland Pty Ltd was to discuss with all its employees and subcontractors on site any site-specific hazards and the Safe Work Methods associated with the work activities scheduled during the day or shift and inform all its employees and subcontractors on site of the preventative measures and procedures that were to be adopted to control or eliminate those hazards. 43In relation to these matters, it was an agreed fact that none of the above steps were taken by John Holland to ensure safety compliance with regard to the work being undertaken by the corporate defendants at the site. It was also an agreed fact that those steps were not "adequately taken" with respect to the operation of the excavator. 44The Agreed Facts also record that Mr Faux, the supervisor appointed by John Holland to oversee the ballast work performed by Mr Marshall, was aware that Mr Marshall had not attended the site office on the morning of the incident in order to "sign on". Mr Faux was also aware that Mr Marshall had not attended the pre-work briefing which was held prior to the commencement of work on the day of the incident. 45This evidence, led for the purpose of the present proceedings, indicates that John Holland controlled the site and had attendant responsibilities for the safety of its employees and sub-contractors at the site, as well as the operations of those sub-contractors. John Holland was also the employer of Mr Stalder and by reason of its responsibilities at the site may be said to have had a more direct role in the supervision of all the workers at the site. Given these matters, it may reasonably be concluded that the overall conduct of the defendants in the present proceedings, although undoubtedly serious, was less culpable than the conduct of John Holland.

Totality 46Both parties submitted that the principle of totality should be applied to penalties to be imposed upon Mr Goldspring on the basis of an overlap between the criminal culpability alleged in the two charges to which Mr Goldspring entered pleas of guilty. According to the prosecutor, as a matter of principle, it would be proper for the overlap in criminality to be reflected in an adjustment of the total penalty to be imposed on Mr Goldspring. The Court agrees with the course proposed by the parties. The overlap arises as a result of the omission, particularised in both charges, concerning the excavator which was allowed to operate at the site in an unsafe condition, that is, without its defects having been repaired beforehand. Accordingly, the principle falls for application with regard to the two charges brought against Mr Goldspring. 47In relation to Earthmoving, I consider that a fine of $105,000 should be imposed for the offence under s 8(2) of the Act. In relation to Goldspring & Sons, I consider that a fine of $84,000 should be imposed for the offence under s 11(1)(a) of the Act. In relation to Mr Goldspring, I consider that a fine of $8,750 should be imposed for the offence under s 8(2) by virtue of s 26(1) and a fine of $7,000 should be imposed for the offence under s 11(1)(a) by virtue of s 26(1). 48In order to reflect the criminality of Mr Goldspring, taking into account the principle of totality, I consider the total fine for the two offences under s 8(2) by virtue of s 26(1) and s 11(1)(a) by virtue of s 26(1) should be $8,750.

Orders 49In IC 2051 of 2008, the Court orders that Goldspring's Earthmoving Pty Ltd is convicted of the offence and fined $105,000 with a moiety to the prosecutor. 50In IRC 2052 of 2008, the Court orders that Fred Goldspring & Sons Pty Ltd is convicted of the offence and fined $84,000 with a moiety to the prosecutor. 51In IC 2053 of 2008, the defendant, Peter Michael Goldspring, is convicted of the offence and fined $4,375 with a moiety to the prosecutor. 52In IC 2054 of 2008, the defendant, Peter Michael Goldspring, is convicted of the offence and fined $4,375 with a moiety to the prosecutor. 53In IC 2051 of 2008, IRC 2052 of 2008, IC 2053 of 2008, and IC 2054 of 2008, the defendants are to pay the reasonable costs of the prosecutor, as agreed or assessed.

Amendments 18 August 2011 - The first paragraph was mistakenly numbered as "6" and all subsequent paragraphs were therefore wrongly numbered. Amended paragraphs: 1-53 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: 18 August 2011