SafeWork NSW v MACFIN Building Solutions Pty Ltd - [2020] NSWDC 776 - NSWDC 2020 case summary — Zoe

NSWNSWDC

SafeWork NSW v MACFIN Building Solutions Pty Ltd

[2020] NSWDC 776

District Court of NSW|2020-11-27

View original source

At a glance

Source facts

Court

District Court of NSW

Decision date

2020-11-27

Catchwords

(2016) 93 NSWLR 338 Capral Aluminium Limited v WorkCover Authority of NSW [2000] NSWIRComm 71
Kirk Group Holdings Pty Ltd v WorkCover Authority of New South Wales (Inspector Childs) (2010) 239 CLR 531
Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96 Orbit Drilling v The Queen

Source

Original judgment source is linked above.

Catchwords

(2016) 93 NSWLR 338 Capral Aluminium Limited v WorkCover Authority of NSW [2000] NSWIRComm 71Kirk Group Holdings Pty Ltd v WorkCover Authority of New South Wales (Inspector Childs) (2010) 239 CLR 531Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96 Orbit Drilling v The Queen

Judgment (23 paragraphs)

[1]

JUDGMENT
On 31 August 2020, MACFIN Building Solutions Pty Ltd ('the defendant') pled guilty to an offence contrary to s 32 of the Work Health and Safety Act 2011 (NSW) ('the Act') that, by failing to comply with the health and safety duty imposed upon it by s 19(1) of the Act, it exposed Mr Mark Dennis and Mr Peter Hubbard to a risk of death or serious injury.
It is a strict liability offence: s 12A of the Act.
The elements are relevantly:

the defendant owed a duty under s 19(1) of the Act to ensure, so far as reasonably practicable, the health and safety of workers;
the defendant failed to comply with that duty;
the defendant exposed workers, Mr Mark Dennis and Mr Peter Hubbard to a risk of death or serious injury.

The offence carries the maximum penalty of $1,500,000.00.
The circumstances of the offence are particularised in the charge and set out in the Agreed Statement of Facts, which are summarised below.
The prosecutor and the court received a Statutory Declaration by Dominic Finlay, sole director and shareholder of the defendant, dated 20 October 2020 upon which the defendant intended to rely. The defendant was not legally represented and Mr Finlay appeared in person on the defendant's behalf.

[10]

REGULATION AND GUIDANCE MATERIAL

Pursuant to s 78 of the Work Health and Safety Regulation 2011 (NSW) ('Regulation'), PCBUs must manage, in accordance with Part 3.1, risks to health and safety associated with a fall by a person from one level or another that is reasonably likely to cause injury to the person or any other person.
Management of this risk by a PCBU in accordance with Part 3.1 of the Regulation includes requirements to: 1. Identify reasonably foreseeable hazards that could give rise to risks of health and safety (Regulation 34); 2. Eliminate the risk to health and safety so far as is reasonably practicable, and if not reasonably practicable to do so, minimise the risk so far as is reasonably practicable by implementing control measures in accordance with the hierarchy of risk control (Regulation 35 and 36); 3. Maintain the implemented control measure so that it remains effective (Regulation 37); and 4. Review and, if necessary, revise all risk control measures (Regulation 38).
The following codes of practice provided specific guidance to PCBUs in relation to managing the risk of falls from heights: 1. SafeWork Australia, Managing the Risk of Falls at the Workplace Code of Practice (April 2016) ('the SafeWork COP') applies to all workplaces where there is a risk of a fall by a person from one level to another that is reasonably likely to cause injury. Specifically, the code of practice provides: 'Protection of openings and holes Holes, penetrations and opening through which a person could fall should be made safe immediately after being formed. If a cover is used as a control measure, it must be made of a material that is strong enough to prevent persons or objects falling through and must be securely fixed to prevent any dislodgment or accidental removal.' 1. The WorkCover Preventing Falls in Housing Construction Code of Practice (July 2014) ('the WorkCover COP') provides practical guidance on how to eliminate, or if that is not possible, to minimise the risk of falls from height in housing construction. This code of practice is approved under s 274 of the Act. Section 1 of the code of practice states: 'Falls are a major cause of death and serious injury in Australian workplaces. Fall hazards are found when carrying out common tasks in the construction of a typical one or two storey house.'
Section 2.1 of the WorkCover code of practice provides guidance on various control measures in the hierarchy of risk control which are available to be implemented in order to provide adequate protection against the risk of falls, such as the installation of a fall prevention device like guardrails.
Section 3 of the WorkCover code of practice also provides the following guidance for void protection: 'Void Protection Where workers are working from trestles, ladders and mobile scaffolds on solid construction and they are located in close proximity to floor openings such as stairwells and partially completed floors, edge protection will not prevent a fall into the opening. The opening must be covered with covers designed to withstand likely impact and static loads and fixed to prevent any dislodgment or accidental removal.'
Section 4 of the WorkCover code of practice states that guardrails may be used to provide effective fall protection at openings in floor or roof structures and at the perimeters of buildings and skylights.

[12]

The Defendant's Failure to Ensure Health and Safety

The defendant bore a duty under s 19(1), and had an obligation to manage risks to health and safety associated with a fall by a person from one level to another that is reasonably likely to cause injury; Regulation 78 of the Regulation. The defendant failed to comply with this duty.
At the time of the incident, there was no adequate cover or fall prevention devices (such as handrails) to prevent the risk of persons falling through the void - or other such penetrations in the roof, and there was no scaffolding or edge protection to prevent the risk of persons falling from the roof.
The defendant had not prepared a site specific SWMS and CCP prepared a SWMS which was generic in nature. There was no safe work procedure for working at heights at the site. None of the workers on site were inducted or instructed/reminded about the risks of working at heights including the risk of falling.
The defendant's failures as set out at [17] of the Amended Summons can be summarised as follows: 1. Require CCP install adequate edger protection (eg guard rails or scaffolding) and protection in respect of voids (eg guard rails or covers of robust construction). It ought to have prohibited workers from accessing or performing work on the roof until this occurred; 2. Provide workers, or request CCP to provide workers with: 1. a site specific SWMS; and/or 2. adequate information/training by way of an induction or safety/toolbox talk in relation to the SWMS or safe work procedure and about the presence of all voids and penetrations in the roof, the risks of falling, and means by which the risk was controlled, 3. and provide adequate supervision to maintain and enforce adherence to the SWMS or safe work procedure.
These pleaded measures are admitted by the defendant to be reasonably practical steps which it ought to have implemented, but failed to do so, giving rise to the risk of death and serious injury to Mr Dennis and Mr Hubbard.
Each of these pleaded measures was addressed by CCP and the defendant after the incident.
I accept that the facts as agreed in the Agreed Statement of Facts establish each of the particulars.

[16]

OBJECTIVE SERIOUSNESS OF THE OFFENCE

The duties of the defendant required that it ensured the health and safety of workers as far as reasonably practicable. The duty requires the identification of risks in the workplace and an assessment of measures to address such risks.
Although the gravity of the risk, degree of foreseeability of the risk and the ease of implementation of remedial measures are relevant to the assessment of objective seriousness, I am not limited to taking into account such factors.
The primary factor to be assessed is the objective seriousness of the offence. Subjective factors play a subsidiary role: Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (1999) 90 IR 464, 474-5.
Subjective factors should not be permitted to produce a sentence which fails to adequately reflect the seriousness of the offence: WorkCover Authority (NSW) v Profab Industries Pty Ltd (2000) 49 NSWLR 700 at [714].
The gravity of the offence is determined by the extent of the duty holder's failure to ensure, so far as was reasonably practicable, that its workers were not exposed to risks to their safety: Orbit Drilling v The Queen; Smith v The Queen [2012] VSCA 82 at [62], and Veen v R (No. 2) (1988) 164 CLR 465.
An offence will be serious where there is an obvious or foreseeable risk to safety against which appropriate measures were not taken even though such measures were available and feasible: Morrison v Powercoal Pty Limited & Anor (No.3) [2005] NSWIRComm 61.
In Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96, Basten JA explained the approach to sentencing as follows: '[34] The sentencing judge commenced his consideration with the proposition that 'greater culpability attaches to the failure to guard against an event the occurrence of which is probable rather than to guard against the occurrence of which is extremely unlikely'. However the truth of that proposition depends upon other considerations including (a) the potential consequences of the risk, which may be mild or catastrophic, (b) the availability of steps to lessen, minimise or remove the risk, and (c) whether such steps are complex and burdensome or only mildly inconvenient. Relative culpability depends on assessment of all those factors. ….. [42] The culpability of the Respondent is not necessarily to be determined by the remoteness of the risk occurring, nor by a step-by-step assessment of the various elements. Culpability will turn upon an overall evaluation of various factors, which may pull in different directions. Culpability in this case is reasonably high because, even if the pressure event of the force which occurred might not be expected to occur often, the seriousness of the foreseeable resultant harm is extreme and the steps to be taken to avoid it, were not even assessed, were straightforward and involved only minor inconvenience and little, if any, costs. ….. [53] The legitimate purpose of intervention in the present case are twofold. The first purpose is to identify the proper approach to considering the objective seriousness of the offences under the Work Safety Act. It is important to note that the risk to be assessed is not the risk of the consequence, to the extent that a worker is in fact injured, but is the risk arising from the failure to take reasonably practicable steps to avoid the injury occurring. To discount the seriousness of the risk by reference to the unlikelihood of injury resulting is apt to lead to error. The conduct in question is the failure to respond to a risk of injury, conduct which will be more serious, the more serious the potential injuries, whether or not they are likely to materialise. The objective seriousness of the conduct will also be affected by the ease with which mitigating steps could have been taken. (my emphasis)
The more obvious the risk, the ease with which it can be controlled or eliminated and the more serious the consequences of the offence, when considered together, the more serious the offence will be.
The relevant factors in determining the defendant's culpabilities are: 1. The risk was a significant one, it was one that was known or identified, and reasonably able to be known or identified, on or before 26 July 2017. 2. The defendant knew or ought to have known that there was a risk of workers sustaining serious or fatal injuries as a result of falls from heights including from voids, edges of the roof and areas not intended to support the load of a person including shade cloth and skylights. 3. The defendant was aware that there were a series of risks at the premises as it conducted an inspection two weeks prior to the incident and identified the void and open penetrations as potential risks. Notwithstanding, the defendant classified the risk as low (ASOF paragraph 33) 4. The risk is reflected in Regulation 78 of the Regulation and the defendant also had available guidance material which outlines the risk of death or serious injury while working from heights as specified at paragraph 36 above - specifically, the SafeWork Australia Managing the Risk of Falls at the Workplace Code of Practice (April 2016) ('Safework COP') and WorkCover Preventing Falls in Housing Construction Code of Practice (July 2014) ('WorkCover COP') (relevantly summarised at ASOF para 45-46). 5. Injuries on building sites are notorious, as are injuries resulting from falls from or through roofs. 6. Therefore, the defendant was or ought to have been aware that Mr Dennis and Mr Hubbard would be at risk of death or serious injury while working from heights. 7. The foreseeability of serious injury was high on the scale of probability noting the risks were identified by the defendant prior to the incident, and no safe work procedures or systems of work were implemented. 8. The existence of simple and straightforward control measures which could have been taken by the defendant to eliminate or minimise the risk to safety is also relevant to assessing the objective seriousness of the offence. 9. By its plea, the defendant admits that the measures particularised were reasonably practicable measures it could have implemented to eliminate or minimise the risk. None of the measures were complex. Indeed many are outlined in the SafeWork COP and WorkCover COP as measures required to eliminate or minimise the risk of falls. 10. It would have been straightforward for the defendant to take the steps particularised. If such steps had been taken, the risks of working at heights would have been significantly reduced and would have minimised the risk of Mr Dennis suffering fatal injuries. 11. The gravity of the potential risk to safety flowing from the breach is relevant as a measure of gravity of the breach and the culpability of the defendant. 12. Although the damage, injury or death caused by the breach does not of itself dictate the seriousness of the offence or the penalty, a breach where there was every prospect of serious consequences may be assessed on a different basis from a breach unlikely to have such consequences. The occurrence of death or serious injury may manifest the degree of seriousness of the relevant risk. 13. In the present case, plainly the possible consequences of the defendant's breaches were death or serious injury. The probability that such consequences would follow, in the event of a fall from the roof, were self-evident. The guidance material available to the defendant identifies the possibility of death or serious injury while working from heights. 14. It is evident that the risk of persons suffering fatal or serious injuries in the circumstances was a real and substantial one, and was not remote. 15. Here, the risk manifested: resulting in Mr Dennis sustaining fatal injuries including intracranial injuries, spine, skull and facial fractures, a collapsed lung and abdominal bleeding. 16. A risk of death or serious injury is inherent to this offence, pursuant to s 32 of the Act. As such, it is not appropriate to also apply the discrete aggravating factor in relation to the grave risk of serious injury or death in s 21A of the Sentencing Act. 17. However, the fact that the offence did cause fatal injuries can be taken into account pursuant to s 21A(2)(g) of the Sentencing Act. It must be established beyond reasonable doubt that the harm was greater or more deleterious than may ordinarily be expected for the offence in question. 18. An offence under s 32 of the Act does not require an injury to be made out, but only the creation of a risk of death or serious injury. Here, the injuries sustained by Mr Dennis were fatal. 19. In SafeWork NSW v Emu Group Pty Limited [2019] NSWDC 537, Russell SC DCJ noted that since the start of 2016 and as at the date of his Honour's judgment on 4 October 2019 the District Court had delivered sentence in 42 cases involving a fall from height. This court has dealt with a number of matters involving falls from defective or incomplete scaffolding and being unsafely up ladders in the construction industry, and it appears the message is not getting through to the industry.
The Court is obliged to make an assessment of where, on the scale of criminality, the offence lies referable to the maximum penalty prescribed by the legislature: R v Cage [2006] NSWCCA 304 per Latham J at [17]-[18].
I find that there was an obvious and foreseeable risk to safety against which appropriate measures were not taken, in circumstances where such measures were reasonably practicable.
Overall, having regard to the above, I conclude the offence is objectively serious, and that the offence falls within the mid-range of offending.

[17]

DETERRENCE

In fixing a penalty in relation to this offence, an important objective feature is the need for specific and general deterrence. This is enshrined in s 3A(b) of the Sentencing Act.
General deterrence is a significant factor when safety obligations are breached. The fundamental duty of the court to ensure a level of penalty for a breach will compel attention to work, health and safety issues so that persons are not exposed to risks to their health and safety at the workplace: Fisher v Samaras Industries Pty Ltd (1996) 82 IR 384 at 388.
When examining matters of deterrence, both specific and general deterrence apply: R v Miria [2009] NSWCCA 68. The Prosecutor submits that the facts of this case do not present any basis for departing from the established principles relevant to deterrence.
The Court of Criminal Appeal in Bulga Underground Operations v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338 at [177]-[180] reaffirmed the principle that both aspects of deterrence are matters which should be normally given weight of some substance in the sentencing process, unless there are exceptional circumstances which would allow a Court to depart from this rule, citing with approval the decision of the Full Bench of the Industrial Court of NSW in Capral Aluminium Limited v WorkCover Authority of NSW [2000] NSWIRComm 71; (2000) 49 NSWLR 610: '[74] … It follows that both aspects of deterrence [specific and general] are matters which should normally be given weight of some substance in the sentencing process; and although there may be exceptional cases (see, for example, Page v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39 at [40]-[43]), we would expect such cases to be very rare and where the relevant circumstances were held by the sentencing judge to be established, the judge must indicate with some precision the circumstances which had led to the exceptional course being adopted. … [75] … Even where an offender demonstrates good character or a commitment to rehabilitation, the court may be obliged to have regard to the need for general deterrence: see R v Thompson (1975) 11 SASR 217 at 222. This is particularly so where the offence in question is prevalent in society and represents a serious threat to the community. The need for general deterrence in relation to serious offences under the Act is undeniable.'
General deterrence must be a significant feature of the sentence imposed upon the defendant. The failure by a company to recognise the dangers and risks that arise to persons working in the construction industry is concerning. Falls from height are a major cause of death and serious injury. The gravity and frequency of injuries resulting from falls from height on construction sites heightens the role of general deterrence.
Workers subjected to a risk of serious injury or death as a result of falling from height is not unique to the circumstances of this defendant. The imposition of a component directed towards general deterrence, it is hoped, will highlight the need for other corporations and individuals, for proper planning and development of procedures to eliminate, or at the very least severely minimise, the presentation of such a risk.
Similarly, general deterrence can be appropriately used to direct the industry's attention to the consequences of inattention and the need for greater concentration on the potential risks associated with the risks of falling from heights.
In relation to specific deterrence, the attitude of the defendant to questions of workplace safety and any steps taken to improve the safety following a breach of a duty are relevant, as is the propensity for the defendant to reoffend.
The requirement to comply with the expectation of the community, that both large and small employers will comply with safety requirements, means that employers must take the obligations imposed by the Act very seriously. However, whilst general deterrence is a matter that I must consider in the sentencing process, it is not a factor to dominate the exercise of sentencing discretion to the exclusion of all factors.
In Inspector Howard v Baulderstone Hornibrook Pty Ltd [2009] NSWIRComm 92 Walton J observed at [241]-[242]: 'There is now ample authority for the proposition that the contribution of another entity to a risk to safety may be considered in mitigation in the assessment of penalty of a defendant. The authorities range from cases such as the present, where the contributing entity has provided services or advice which have contributed to the detriment to safety (McDonald's) to, more commonly, cases where the entity or entities are engaged in a common project, enterprise or task with the defendant which carries out the role of a principal, contractor or fellow sub-contractor: Morrison v Waratah; Morrison v Powercoal (2005); WorkCover Authority of New South Wales (Inspector Mansell) v Anytime Industrial Services Pty Ltd (2001) 110 IR 34; WorkCover Authority of New South Wales (Inspector Farrell) v Morrison (No 2) (2002) 112 IR 312; WorkCover Authority of New South Wales (Inspector Mansell) v Orica Australia Pty Ltd (2002) 116 IR 158 and WorkCover Authority (NSW) v Consolidated Constructions Pty Ltd (2001) 109 IR 316.'
In these proceedings, it is relevant to consider the attitude of the defendant to questions of workplace safety, any steps taken to improve safety following a breach of duty and the propensity of the defendant to re-offend.
After the incident an Improvement Notice was issued and the defendant prepared a SWMS in response. The defendant also engaged a safety contractor to assist in updating safe work procedures, improving site safety and to decrease exposure to hazardous environments. This is detailed in the document prepared by Mr Finlay on behalf of the defendant.
The defendant continues to provide residential, commercial and civil waterproofing services and thus is responsible for people working at heights. It is apparent both from the inherent nature of the construction industry, and the specific nature of waterproofing roofs, that the defendant must constantly manage the risks to health and safety associated with the risk of falls. It is important that the defendant is vigilant in ensuring that strict control measures are in place and supervised. It is for this reason that the penalty imposed contains a significant component for specific deterrence to compel it to take a rigorous approach to health and safety in the future.

[20]

CAPACITY TO PAY

The defendant has raised the issue of its ability to pay any fine due to its financial circumstances, but does not make an application under s 6 of the Fines Act 1996 (NSW).
In the statement that Mr Finlay provided, he sets out the endeavours he has made to build the defendant into a reliable contractor in the waterproofing industry. He also indicates that in August 2018, one of the defendant's major clients went into voluntary liquidation owing the defendant over $180,000 for unpaid works, which has been written off by the defendant as a bad debt. He indicates that this has happened with other clients as well, yet he is trying to endure these hardships as a matter of pride and goodwill, and I accept that is the case.
The defendant appeared through its director Mr Finlay unrepresented. Prior to me coming onto the Bench, I understand that Mr Finlay and learned Senior Counsel for the prosecution had had some discussions as to how the sentence hearing should proceed. As a result of those discussions, the prosecutor suggested that Mr Finlay give sworn evidence to address the fact that there was no evidence as yet available as to the defendant's financial circumstances nor its remorse.
I must make comment on the conduct of the Senior Counsel for the prosecution and the manner in which the matter ultimately proceeded. To have the prosecutor adducing evidence from the director of the defendant to assist his plea in mitigation is most admirable. The Court is very grateful to the prosecutor for enabling all of the relevant material being placed before the court with regard to the considerations I must turn my mind to in coming to the appropriate penalty. I commend Senior Counsel for her sensible and sensitive approach.
The evidence Mr Finlay gave demonstrates that he is paying himself a salary of approximately $55,000 per annum since about 2016, but in the last 12 months he has experienced a significant downturn I the amount of work the defendant has been offered and as a consequence he has been financially compromised. He stated that the company has no money in the bank and he is borrowing money and using his own personal resources to keep the defendant afloat. He has not made a claim on his insurance.
Based on all the evidence before me, I accept that the imposition of a significant fine will have a detrimental effect on the defendant's financial circumstances, and on that basis I will afford it some leniency. However, this will not outweigh the specific and general deterrence that must be evidenced by the imposition of a fine, due to the objective seriousness of the offence.
Mr Finlay also explained having "the worst feeling in my life, just recalling it" when asked about how the incident had affected him. I accept that the defendant has expressed contrition and remorse through Mr Finlay and acknowledges that it is responsible for the incident occurring: s 21A(3)(i) of the Sentencing Act.
The court is entitled to take into account the fact that the defendant will be liable to pay the prosecutor's costs when considering any monetary penalty to be imposed on the defendants, particularly in circumstances where there is evidence of a limited capacity to pay a fine. The costs payable to the prosecutor are an important aspect of the punishment of the defendant. The Court can also have regard to the defendants' own costs that it will have to bear as a consequence of a breach of the Act: Environmental Protection Authority v Barnes [2006] NSWCCA 246 at [78].
As I have accepted that the defendant may have some difficulty paying the fine, I am of the view that to waive the payment of the prosecution's costs forms a balance between the need for general deterrence and the defendants' somewhat limited capacity to pay.
The appropriate fine is $200,000.00. The defendant is entitled to a discount of 25% for the early plea.

SafeWork NSW v MACFIN Building Solutions Pty Ltd

At a glance

Court

Decision date

Catchwords

Source

Catchwords

Judgment (23 paragraphs)

Parties

Legislation Cited (4)

Cases Cited (27)

Cited By (5)