Nolan v Kreidies Management Group Pty Ltd

The facts

1. As mentioned these were the subject of an agreement which was tendered. The following details are drawn essentially from this document. On 31 October 2012 the defendant, which had a contract with Sims Group Australia Holdings Limited for the transport of scrap steel, was engaged to collect a consignment of scrap steel from Delta Pty Ltd at Bourke Road, Alexandria for transport by road to Sims' yard at St Marys (a distance of about 60 kms) on 1 November 2012. The job was allocated by the defendant's manager to Mr Omar Kreidie, a driver employed by it. On 1 November 2012, as instructed, he drove the heavy vehicle combination comprising a prime mover and two trailers to Sims' premises in Alexandria to collect the consignment. The trailers were loaded with scrap steel by Mr Aldhayvi, an employee of a company, Mad Transport Pty Ltd, which was subcontracted to Delta. At about 9.30am the loaded vehicle, on the way to St Marys via the M5 East Expressway, struck and dislodged the overheight steel beam about 10 metres inside the Tunnel. The beam was set at a height of between 4.68 metres and 4.7 metres above the roadway. Inspectors from the Roads and Maritime Services NSW attended the scene and, amongst other things, measured the combination with its load at 4.97 metres high. The height of the load was reduced by cutting the scrap steel and the combination could then be removed from the tunnel.
2. The height limit applicable to the combination was 4.3 metres (as a permit exempting it from the dimension requirement had not been issued).
3. The driver was interviewed by RMS inspectors and, amongst other things, stated that he had checked the height of the combination by driving under a 4.3 metre beam at the Delta yard but did not use any other method to check it. He said the size and tailgates of the trailer are used to secure the load, usually weighed down by placing cars or heavy steel on top of the scrap but he thought the Delta yard had run out of these items so that the load sprung up during the trip which it is always liable to do, sometimes breaking the chains which hold it down. He had not noticed any flashing warning lights on his approach to the tunnel which diverted overheight vehicles away from the entrance but, as I understand it, he believed that his vehicle was not over height. The defendant's manager, Mr Salahddine Kreidie, informed the inspectors that he had allocated the job but had not given any instructions to check the height of the load because the driver knew what the legal height was and "has been doing it every day". For the same reason he did not need to give him any instructions on restraining the load. The driver was not provided with any equipment to measure the load, which is simply estimated from the known height of the prime mover and trailers. As it happened, on the day after the incident, inspectors attended Delta's premises in Alexandria and were told that there was no 4.3 metre beam for heavy vehicles to pass under before departing the site.

The defendant's response

1. The manager gave evidence, apologising on behalf of the company for all of the damage and inconvenience caused by the incident. The company policy and safety manual in operation at the time of the offence specifically prohibited driving any of the company trucks in tunnels. After the incident he asked the driver why he had used the tunnel and was told that he was running late and heard of an accident on an alternative route so he detoured to go through the tunnel on that day. Mr Kreidie's father (the defendant's sole director and shareholder) was very upset by the accident, which affected his health adversely. The driver was disciplined by being stood down for a time. He has been warned that if the company rules are broken again he will be permanently dismissed.
2. The defendant runs about 15 trucks, but Sims has been reducing its use of the company, in part because of the tunnel claim. It has instituted supervision methods to ensure that this kind of incident does not happen again, including navigation devices operating in real time and now requires input of height and weight dimensions. Mr Kreidie pointed out that this particular load was placed on the truck at a customer's yard not that of Sims and the customer did not have facilities for checking heights or for cages and harnesses to use a forklift to ensure the load is secure before the truck went onto the road. There were commercial pressures to increase the tonnage and so load the scrap metal directly to the combing rail of the trailer, which then allowed the scrap metal to exceed the appropriate height where there was nothing to impede its movement. This has now been changed so that the load is under the combing rail. This reduces the tonnage able to be carried by about 10 per cent and, since the company is paid by tonnage, also reduces its price for transport.
3. This is the first offence which involves an incident in a road tunnel in over 15 years that the company has been in business. There had previously been severe breaches of dimensions offences having to do with width when the bins would sometimes belly out but bigger trailers of different design have corrected this problem.
4. I am satisfied that management of the defendant genuinely regretted the incident itself, has acknowledged the seriousness of the offence and has taken appropriate steps, at some significant commercial cost, to ensure that nothing of this kind occurs again.

Sentence

1. Under s 37(3) of the Act, the lower limit applicable to a "severe risk breach" of a height limit is 300mm over the maximum permissible dimension limit of 4.3m. In this case, it follows that the present breach is a severe risk breach (by definition) because the relevant combination was 4.97m high when it was measured in the tunnel, thus exceeding the relevant height limit by 670mm. Mr Cahill of counsel for the plaintiff submitted that exceeding the lower limit applicable to a severe risk breach increases the gravity of the offence. The defendant has some prior relevant convictions which I have already mentioned but not in respect of height. The applicable maximum penalty is 500 penalty units or $55,000: s 59 of the Act - column 5.
2. The Act provides for particular matters to be taken into account - Section 60(2)(c) … (2) In determining the sanctions (including the level of fine) that are to be imposed in respect of breaches of mass, dimension or load restraint requirements, a court is to take into consideration the classification of the breach under this Part and, having regard to that classification, the following matters: … (c) severe risk breaches involve one or more of the following: (i) an appreciable risk of harm to public safety or the environment, (ii) a serious risk of accelerated road wear, (iii) a serious risk of harm to road infrastructure, (iv) a serious risk of increased traffic congestion, (v) a serious risk of diminished public amenity, (vi) a serious risk of unfair commercial advantage.
3. The direct consequences of the overheight vehicle being driven into the tunnel included the damage to the tunnel infrastructure, the need to disconnect services to the tunnel and make extensive repairs entailing the closure of the tunnel for about 14 hours. Although it was the accident here which gave rise to the damage caused by the overheight loading, it is important not to treat this, as it were, as happenstance caused by the need for the driver to change his route. Even if no accident had occurred, the potential for damage was present and the specified serious risks, to a greater or lesser extent, would have remained. Those risks are objective features of the offending which must be reflected in the sentence. It is nevertheless fair to observe that avoiding the tunnel (obligatory under the defendant's manual) would have lessened risks 2(c)(ii),(iii),(iv) and (v), though they were not obviated.
4. Although the lack of an appropriate measuring device at the point of load was a significant departure from what, as a minimum, safe procedures required, this was not the only problem. It may well be that the load did not exceed the stipulated height when the combination left the yard but that the characteristic and known likely springing of the scrap metal occurred as the truck was moving. Indeed, I think this is the likely course of events since I would be prepared to accept that the driver could, within reasonable limits, have accurately assessed the height of the combination after it had been loaded and did so, although of course not with the accuracy which an appropriate measuring device would have afforded. The fact that he knew of the spring effect meant there was an element of risk taking both on his part and that of management in the sense that it took no steps to effectively deal with that issue.
5. It is agreed that s 21A of the Crimes (Sentencing Procedure) Act 1999 (NSW) applies to sentencing the defendant for the present offence. In particular, s 21A(2)(g) of the Act provides that the damage flowing from the defendant's breach is to be taken into account as a matter of aggravation. Although the offence is described as a "severe risk breach" (by way of definition) the actual seriousness of the breach is a distinct matter and needs to be separately assessed, reflecting what actually occurred. In this respect, Mr Cahill points to the fact that the load was to be transported at a distance of approximately 65km by way of travel on major arterial roads which happened to include, on the day in question, the M5 East Motorway. It is clear that, despite the likelihood that a load of scrap metal will move upwards during travel, especially if there were no countervailing weights placed on it (such as motor vehicles or heavy steel beams), there were no procedures in place that permitted the driver to actually measure the height of the load or authorise him to reduce the load so that, even with an upward shift, it would not exceed the relevant height limits. It is also fair to say that the defendant failed to provide the driver with appropriate loading instructions. The prohibition concerning travel in tunnels is an obvious precaution but the dangers of driving an overheight combination on the busy arterial roads of Sydney is obviously dangerous. It was, in substance, conceded by the general manager in his evidence that the corrective steps presently utilised could, and indeed should, have been in operation considerably before the incident here occurred. Furthermore, but for the accident, it seems likely that the defendant would have continued to avoid its responsibilities so far as height restrictions are concerned and the driver would have continued to carry excessive loads until some other incident occurred to bring this conduct to an end.
6. Mr Cahill rightly submits that in this context, general deterrence is an important factor: see Kemp v Air Liquide Australia Ltd [2014] NSWSC 1200 per Garling J at [10], [81] - [82]. Other companies must be deterred from continuing with inappropriate and dangerous practices in the hope that accidents can be avoided by specifying routes drivers are to take. Mr Cahill also contends that, although the defendant continues to transport scrap metal by road within the State, there is no evidence that it has taken steps to obtain relevant engineering advice regarding the loading, compaction and restraint of the loads, which raises a risk of reoffending. As to this, I am satisfied from the evidence of the general manager that appropriate steps have been taken to ensure that the prescribed height dimensions are complied with. He was not cross-examined to suggest that further engineering advice might be useful and this is not a matter upon which I am disposed to speculate.
7. The plea of guilty is to be taken into account, not only as evidence of contrition but also for its utilitarian benefit. Here, as I have outlined, the plea of guilty was made on the first day of the hearing, after the clarification of certain factual and legal issues. Nevertheless, some benefit arose from this change of approach. In the circumstances I consider that a 10 per cent discount is appropriate. I am satisfied that the defendant is unlikely to reoffend and has taken rehabilitative action, which are mitigating factors both generally and by reference to s 21A(3)(g) and (h) of the Crimes (Sentencing Procedure) Act. I am also satisfied that the defendant has accepted responsibility, through its management, for its actions and has acknowledged the injury, loss or damage caused by the breach (see s 21A(3)(i) of the Crimes (Sentencing Procedure) Act).
8. Sims was fined $3000 (following a discount of 25 per cent for its early plea) whilst Delta was fined $6000 with the same discount.
9. In my view, the appropriate fine is $8,000 which, when reduced by the discount for pleading guilty, comes down to $7,200.
10. Section 210 of the Road Transport (General) Act provides for the making of a "roads compensation order" in respect of damage to road infrastructure by a breach. The overall cost of repairs as certified pursuant to s 202 of the Act is just under $222,000. Both Sims (as consignor) and Delta (as loader) pleaded guilty to contraventions respectively of s 53 and s 55 of the Act and consented to the making of roads compensation orders against them upon entry of conviction, against the former for $55,494.85 and the latter $66,593.85. The balance of $99,890.75 is sought by way of a roads compensation order against the defendant, which has consented to it. The driver of the vehicle pleaded guilty to contravening s 57 of the Act, was convicted and fined $2,250 plus professional costs of $1,200. A roads compensation order was not sought against him.

Costs

1. It is agreed that the costs payable pursuant to s 214 of the Act in relation to the roads compensation order should be $60,000 and, in relation to the prosecution, the sum of $15,000.
2. Accordingly I make the following orders - 1. The defendant is convicted. 2. The defendant is fined the sum of $7,200. 3. Pursuant to s 257B of the Criminal Procedure Act 1986 (NSW) in relation to the offence contrary to s 56 of the Road Transport (General) Act 2005 (NSW) the defendant is ordered to pay the plaintiff's costs in the sum of $15,000. 4. Pursuant to s 210 of the Road Transport (General) Act 2005 (NSW) order that the defendant pay to Roads and Maritime Services compensation in the sum of $99,890.75 for the damage to road infrastructure, namely the road and M5 Tunnel infrastructure, incurred by Roads and Maritime Services as a consequence of the commission of the offence. 5. Pursuant to s 214 of the Road Transport (General) Act 2005 (NSW) the defendant is ordered to pay the plaintiff's costs in the sum of $60,000.

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: 03 June 2016