Morrison v Eureka Opals Pty Limited

Crimes (Sentencing Procedure) Act 1999 s 10 LEGISLATION CITED: Fines Act 1996 s 6 Occupational Health and Safety Act 1983

Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 Inspector Stephen Campbell v James Gordon Hitchcock [2005] NSWIRComm 34 Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 Maddaford v Coleman [2004] NSWIRComm 317 Markarian v R (2005) 215 ALR 213 Morrison v Eureka Opals Pty Limited [2005] NSWIRComm 80 CASES CITED: Morrison v Eureka Opals Pty Limited [2005] NSWIRComm 437 Morrison v Peter James Buchanan [2004] NSWIRComm 223 Morrison v Powercoal Pty Limited & Anor (No 3) [2005] NSWIRComm 61 Signato v The Queen (1998) 73 ALJR 162 WorkCover Authority of New South Wales (Inspector Peter Ankucic) v McDonald's Australia Ltd and Another (1999) 95 IR 383 WorkCover Authority of New South Wales (Inspector Farrell) v Schrader (2002) 112 IR 284 WorkCover Authority of New South Wales v Profab Industries (2000) 100 IR 64

APPELLANT Mr M Scott of counsel Solicitor: I V Knight Crown Solicitors Office LEGAL REPRESENTATIVES: RESPONDENT Mr I Latham of counsel Solicitor: Mr B Muir Brian Muir & Company

CORAM: WRIGHT J, President WALTON J, Vice-President BOLAND J

Application by Rodney Dale Morrison for leave to appeal and appeal against a judgment of Staunton J given on 16.03.2005 in matter no. IRC 1593 of 2002.

1 These proceedings involve an application for leave to appeal and appeal by Rodney Dale Morrison ("the prosecutor") from a judgment and orders of Staunton J in Morrison v Eureka Opals Pty Limited [2005] NSWIRComm 80 dismissing a charge that Eureka Opals Pty Limited ("Eureka") had committed an offence under s 17(1)(a) of the Occupational Health and Safety Act 1983 ("the Act"). 2 On 25 November 2005, in Morrison v Eureka Opals Pty Limited [2005] NSWIRComm 437, the Full Bench made the following orders:

(1) Leave to appeal is granted. (2) The appeal is upheld. (3) The judgment of Staunton J given on 16 March 2005 and the orders of her Honour made on 24 October 2005 in IRC Matter No 1593 of 2002 are set aside. (4) Eureka Opals Pty Limited is found guilty of an offence under s 17(1)(a) of the Occupational Health and Safety Act 1983. (5) Costs, including costs of proceedings at first instance, are reserved pending the determination of sentence. (6) Within 28 days of delivery of these reasons, in accordance with a timetable to be agreed between the parties, the parties shall file and serve their written submissions and any evidence they wish to rely on in respect of the penalty phase and the costs of the proceedings. (7) Any application for an oral hearing in respect of penalty and costs shall be made as soon as practical but no later than 21 days from today. 3 This judgment deals with penalty. Background 4 The facts and charge were described in our judgment of 25 November 2005 as follows:

4 The prosecution of the respondent arose out of an incident that occurred on 28 March 2000 when a part of the roof of an underground opal mine collapsed. At the time of the collapse the mine was being worked by Peter Buchanan and Anthony Kennedy. Mr Kennedy was seriously injured. Neither Mr Buchanan nor Mr Kennedy were employees of the respondent. The mine was located at Dead Bird Opal Field at Lightning Ridge and the respondent was the registered claim holder of the mine, which was known as Claim 26313. 5 The charge brought against the respondent was that being the controller of non-domestic premises (i.e., Claim 26313) that was made available as a place of work, the respondent did fail on 28 March 2000 to ensure the premises, and the means of access thereto or egress therefrom, were safe and without risk to health. The particularised failures of that charge were that the respondent: (i) Failed to ensure that the shaft used for access remained uncluttered and able to be used in an emergency situation to retrieve injured persons. (ii) Failed to ensure that the ladders used to gain access to the mine were properly secured and not swinging. (iii) Failed to ensure that adequate and proper propping and/or bracing of the roof took place. (iv) Failed to ensure that the mine was equipped with an adequate communication system so as to enable medical and emergency services to be contacted when persons were injured in the mine. (v) Failed to develop and put in place an emergency procedure. (vi) Allowed the roof collar to be over excavated so as to reduce its support.

5 The second, third and sixth particulars were not made out. The Full Bench made the following findings in relation to the other particulars which were made out: 55 The charge alleged a failure to ensure the means of access to the mine or egress therefrom, were safe and without risk to health. The evidence was that the seriously injured Mr Kennedy could not be removed from the mine through the shaft used to access the mine because the stretcher would not fit and an exit from another claim had to be found. In our opinion, the particular is made out beyond a reasonable doubt. The inability to exit the mine was causative of a risk to Mr Kennedy's health and safety. There was no issue in these proceedings that the opening of the mine lay squarely within the boundaries of the claim. ...

60 The fourth particular alleged that the respondent had failed to ensure that the mine was equipped with an adequate communication system so as to enable medical and emergency services to be contacted when persons were injured in the mine. The communication system was clearly inadequate and, indeed, there was no such system that we have been able to discern. Peter Buchanan had to exit the mine, find his brother, Wayne, who was working at an adjoining claim, who then had to find someone with an operational telephone (mobile phones were useless in the area) and it was an hour before rescue arrived. Delay was also encountered in contacting the Police Service, with the Lightning Ridge station not answering the calls made to it. 61 Mr Latham had submitted at first instance, there was no causative link between the risk to safety and the inadequate communication system. Staunton J made no finding in this respect. On appeal, the respondent did not rely on the absence of causation but rather on a defence under s 53 of the Act to the effect that the communication failures were due to causes against the happening of which it was impracticable for the respondent to make provision. 62 The relevant risk to health and safety was that in the absence of an adequate communications system there could be a significant delay in contacting medical and emergency services to assist in the evacuation and treatment of a person injured in the mine. In this case the inadequacy of the communications system increased the risk to health and safety. Causation is established and the fourth particular is made out.

63 To establish a defence under s 53, a defendant must prove, to the civil standard, either that it was not reasonably practicable to comply with the Act or that the commission of the offence was due to causes over which the defendant had no control and against the happening of which it was impracticable to make provision. What the respondent in this appeal contended was that it had no control over the unavailability of a mobile phone service and no control over the failure of the Lightning Ridge Police to answer the phone. Such a contention does nothing to discharge the onus on the respondent to show it was not reasonably practicable to ensure the safety of persons working Claim 26313 or that that the failure was due to causes over which the respondent had no control and against the happening of which it was impracticable to make provision. 64 It was reasonably foreseeable that a risk to health and safety might arise if the communications system at the mine was inadequate. However, there was no evidence brought by the respondent to show that it was not reasonably practicable because of the absence of technologies other than mobile phones, or cost, or time, or the trouble involved, to adopt measures to avert the risk to health and safety: See WorkCover Authority of New South Wales (Inspector Patton) v Fletcher Constructions Australia Limited (2002) 123 IR 121 at [83] to [86]. It is apparent that the respondent had not given any consideration to providing adequate communication at the mine in the event of an accident. We are satisfied beyond reasonable doubt that the respondent failed to ensure that the mine was equipped with an adequate communication system so as to enable medical and emergency services to be contacted when persons were injured in the mine. 65 The fifth particular pleaded was that the respondent failed to develop and put in place an emergency procedure. At first instance, counsel for the respondent conceded there was evidence of the facts alleged in the particular but submitted there was no evidence that the failure as particularised caused the risk to health and safety. Staunton J made no finding in relation to the alleged failure. 66 The pleadings do not explain what was meant by "emergency procedure". However, it is evident from the proceedings at first instance that it was understood by the respondent to refer to an emergency procedure for dealing with accidents in the mine that might result in injury to a person. Such a procedure would normally countenance such measures as the provision of first aid, avoiding further risk, evacuation procedures where possible and contacting medical and emergency services.

67 To some extent the fifth particular overlapped with the fourth particular involving a failure to provide an adequate communication system to contact emergency services. Nevertheless, it was Wayne Buchanan's evidence that there was no emergency procedure in place at the mine. This is supported by the fact that before having to go off in search of a telephone the only action Peter Buchanan took immediately following the roof fall was to ask Mr Kennedy if he was all right, wait for him to return to consciousness and pull him clear of the debris. 68 The risk to health and safety in the absence of an emergency procedure was that without such a procedure no forethought had been given and no systematic plan was in place to avoid further risk from roof collapse or to treat the injured person appropriately with first aid thereby running the risk of further injury and increasing the seriousness of injuries already sustained. The particular is made out. 6 The prosecutor made the following submissions on sentencing:

The majority decision of the High Court in Markarian v R (2005) 215 ALR 213 casts doubt on determination of a sentence based on a consideration of the objective considerations and then a mathematical exercise of deducting from that initial position amounts for particular subjective matters. It does not criticise the approach to sentencing set out in Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464.

General deterrence is particularly relevant to this matter. There seems to be an understanding amongst opal miners near Lightning Ridge that Claims holders are not required to ensure the health and safety of people performing work on that Claim.

Specific deterrence should also be taken into account. Although there was no evidence before the Court as to the current operations of Eureka, there was also no evidence that the defendant took any steps, after the accident, to overcome the risks to health and safety presented by the mine.

Although serious (considering that the risks were both life-threatening and obvious), the offence does not have the character of a "most serious offence". There is no evidence that Eureka took any steps either before or after the accident to overcome the risks to health and safety.

Subjective considerations include the fact that Eureka has no prior offences and consistently co-operated with the prosecutor during its investigation of the accident.

While effect must be given to s 6 of the Fines Act 1996 and the Commission must take into account any evidence concerning Eureka's means to pay, these factors must be balanced against Eureka's culpability, the significant risks to health and safety, and the lack of any remorse or contrition on behalf of Eureka.

It is difficult to apply the principle of parity (as between Eureka and Peter James Buchanan, who was fined $4,500 pursuant to a charge arising from the same accident in Morrison v Peter James Buchanan [2004] NSWIRComm 223) to this matter. The fine imposed on Peter Buchanan was in the context of a maximum fine of $55,000 and was limited due to the defendant's impecuniosity and the provisions of the Fines Act. Nor is there any basis for Eureka's submissions alleging culpability on the part of the Crown and the Department of Mineral Resources as the basis for the application of the principle of parity.

There is nothing extraordinary or exceptional about this matter justifying the application of s 10 of the Crimes (Sentencing Procedure) Act 1999. The defendant was aware of the circumstances of the mining activity through the visit of one of its directors to the mine. Although the defendant could have taken steps to rectify defects in the operation of the mine leading to the risks to health and safety, no such steps were taken. Further, s 10 is to be used with regard to natural persons rather than corporate entities.

The prosecutor seeks costs of the hearing at first instance and of the appeal and a moiety of any fine imposed on the defendant. 7 Eureka made the following submissions:

Any penalty higher than a nominal fine would be oppressive.

Markarian v R brings into doubt determination of a sentence based upon a consideration of the objective considerations and then a mathematical exercise of deducting amounts for particular subjective matters. To the extent that Lawrenson Diecasting sets out a two stage sentencing process it is not good law and should not be followed.

The objective seriousness is at the very low end of the matrix of criminality. None of the particulars made out involved a risk of injury; they go to the treatment of injured workers. There is no evidence that the risk created caused any exacerbation of the injury suffered.

The need for general deterrence has been served by the inconvenience and cost experienced by Eureka and its director throughout the investigation, prosecution and appeal process and does not require a substantial fine. Alternatively it could be served by sentencing Eureka to a bond.

There is no evidence before the Court as to whether Eureka continues to perform opal mining. Consequently, the Court cannot take specific deterrence into account.

In mitigation, the Court should consider that the offence was not part of a planned or organised criminal activity; Eureka has no prior record; was a person of good character; was unlikely to re-offend; has good prospects of rehabilitation; and provided assistance to the authorities.

Mr Peter Buchanan was fined $4000 for an offence arising from the same factual matrix. The Court should observe the principle of parity in sentencing Eureka, taking into account the higher culpability of Mr Buchanan based on the higher number of particulars established in his case and the fact that he directed Mr Kennedy to work in an area of the mine knowing that the area was without adequate roof support. The fact that Mr Buchanan's fine was significantly reduced due to his impecuniosity is no reason to ignore the principle of parity: Eureka is also on the verge of impecuniosity.

Notwithstanding the explicit rejection in WorkCover Authority of New South Wales (Inspector Peter Ankucic) v McDonald's Australia Ltd and Another (1999) 95 IR 383 at [158], there is some support for the proposition that the Court may take into account for the purposes of parity the culpability of persons who were not charged. To the extent permissible, the Court should take into account the culpability of the Department of Mineral Resources (as regulator of the mine) and the Crown (as owner of the mine).

8. Eureka has very limited means to pay and the Court should take this into account in mitigation. Any substantial fine or costs order would almost certainly lead to its liquidation.

The Court should exercise its discretion under s 10 of the Crimes (Sentencing Procedure) Act 1999 to either direct that the charge should be dismissed or discharging Eureka on condition that it enter into a good behaviour bond on the basis that this is an extraordinary and highly exceptional case as discussed in WorkCover Authority of New South Wales v Profab Industries (2000) 100 IR 64 at [26]. Although bonds are uncommon in sentencing under the Occupational Health and Safety Act there seems little reason why one should not be issued in appropriate circumstances.

The prosecutor should pay the defendant's costs of the proceedings at first instance and no order as to costs should be made in relation to the appeal.

8 We agree with the prosecutor that this offence is not in the category of "most serious offences". However, the risks arising from failures to ensure adequate egress in emergency situations; adequate communications systems and adequate emergency procedures were obvious and foreseeable risks. Furthermore, we accept the prosecutor's submissions as to the importance of general deterrence in this case, and note that Eureka has not put forward any evidence upon which we could conclude that the risk of re-offending is so low as to rule out consideration of specific deterrence: see generally Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 at [76] - [77]. In this light, and following cases such as Capral Aluminium at [82] and Inspector Stephen Campbell v James Gordon Hitchcock [2005] NSWIRComm 34 at [28], the offence must be viewed as objectively serious. 9 Eureka's submission that none of the particulars which were made out involved a risk of injury is misconceived. It has long been recognised by this Court that the gravity of the consequences of an accident, such as the damage or injury, does not, of itself, dictate the seriousness of the offence or the amount of penalty: see Capral Aluminium at paragraphs [94] and [95]. Secondly, each of the failures particularised could have resulted in the risk of serious injury: it is not difficult to imagine the consequences for someone suffering a spinal injury (for example) if he or she could not be removed from the mine on a stretcher. Similarly, it is not difficult to imagine the consequences of delay (both of which are implicit in the remaining two failures) for someone who had been critically injured. 10 Similarly, we do not accept Eureka's submission that the need for general deterrence has been served by the inconvenience and cost experienced by Eureka during the investigation and subsequent prosecution. These factors are experienced by every defendant, even where there is no compelling need for general deterrence. Moreover, the principles relating to general deterrence set out in WorkCover Authority of New South Wales (Inspector Farrell) v Schrader (2002) 112 IR 284 at [69] - [70], referred to with approval by the Full Bench in Maddaford v Coleman [2004] NSWIRComm 317 at [80], emphasise the more severe punishment which attends general deterrence, should it feature in sentencing. This purpose would not be served by a bond. 11 There is no evidence to substantiate Eureka's submissions that Eureka is a person of good character and is unlikely to offend. Nor are the issues of criminal intent or prospects of rehabilitation relevant to sentencing for offences under the Occupational Health and Safety Act. 12 It is sufficient for the purposes of this judgment to note that there are subjective factors which must be taken into account (and for which we make allowance) such as Eureka's lack of prior convictions and consistent co-operation with the prosecutor during its investigation of the incident. It is not necessary to resolve any issues of principle concerning the exercise of sentencing discretion which may arise due to Markarian v R (2005) 215 ALR 213, except to say that we agree with the submissions of the prosecutor that nothing in Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (whose primary authority relates to general objective considerations) offends the principle in Markarkian against two stage sentencing.

13 Having regard to the objective seriousness of the offence, and the lack of exceptional or extraordinary matters, there is no proper basis for the exercise of our discretion under s 10 of the Crimes (Sentencing Procedure) Act 1999 (see, for example Morrison v Powercoal Pty Limited & Anor (No 3) [2005] NSWIRComm 61 at [130]-[135]). Accordingly, it is not necessary to consider whether s 10(1) applies to corporations in addition to natural persons. (We note in passing that the prosecutor has not put forward any submissions to substantiate this contention). 14 Finally, this is not an appropriate matter to apply the principle of parity. In relation to Eureka's allegations concerning the Department of Mineral Resources and the Crown, neither of which was charged with any offence, we adopt the ratio in WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Limited (1999) 95 IR 383 at [160]-[161]: it is not consistent with the principle of parity for the Court to embark upon an inquiry in sentencing proceedings which, in substance, would require the Court to make specific findings as to the culpability of such entities and the "nature and quality" of any offence committed by them. 15 As the Court noted in WorkCover v McDonald's Australia Ltd at [152], the principle of parity only operates to the extent of comparing like with like. Differences in sentences arising from different circumstances, including differences in maximum penalty for the same offence, will not violate the principle: Signato v The Queen (1998) 73 ALJR 162 at 170. In this case, not only did Mr Buchanan face a different maximum penalty, his penalty was limited, in the discretion of the Court, due to his impecuniosity. The exercise of such a broad discretion - dependant upon many factors particular to Mr Buchanan's circumstances - precludes the comparison of like with like. 16 Taking into account the factors mentioned above, in the context of the maximum penalty of $550,000, we have determined that Eureka should be fined $30,000. In the exercise of our discretion to fix this fine, in accordance with s 6 of the Fines Act, we have taken into consideration the matters raised by Mr Wayne Buchanan, director, in his affidavit sworn 10 February 2006 concerning Eureka's means to pay. Orders

1. In matter number IRC 1737 of 2005, Eureka Opals Pty Limited is fined the amount of $30,000. The prosecutor shall have a moiety of the fine.

2. There shall be no order for costs of the appeal. The appellant should pay the costs of the respondent at first instance as agreed or as assessed in accordance with the Rules of the Commission.

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