SafeWork NSW v Maluko Pty Ltd

District Court of NSW|2023-07-18|Before: Gleeson CJ, James JJ, Hunt JJ

Background

Where a corporate defendant committed an offence under s 32 of the WHS Act before 10 June 2020, the maximum penalty was $1,500,000. The penalty under s 32 for a corporate defendant was increased by the Work Health and Safety Amendment (Review) Act 2020 (NSW) (the Amendment Act).
Section 2 of the Amendment Act provides that it commences on the date of assent. The Act was assented to on 10 June 2020.
Schedule 2, cl 8 of the Amendment Act omits "$1,500,000" from the penalty provision under s 32 of the WHS Act and inserts instead "17,315 penalty units".
Schedule 1, cl 19 of the Amendment Act inserts a new Part 13 Div 2A into the WHS Act dealing with "Penalty Units". Section 242B, part of Div 2A, sets out the value of penalty unit. Section 242B(1)(a) provides that the value of a penalty unit is $100 for the financial year 2019-2020.
While the written submissions of both counsel put forward a different figure, after discussion with the Bench both parties agreed that the maximum penalty applicable in the present case, after 10 June 2020, was $1,731,500.

When was the Offence Committed?

The Amended Summons (PX 1, Tab 1) pleads that Maluko failed to comply with its duty under s 19(1) of the WHS Act "between 5 June 2020 and 12 June 2020". Further, the Amended Summons pleads that the failure to comply with the duty "exposed workers, including Jose Martins, to a risk of death or serious injury contrary to s 32 of the Act". The "date of offence" is specifically stated to be "Between 5 June 2020 and 12 June 2020". The date of 5 June 2020 is day after the gate was initially damaged after a vehicle ran into it, causing significant damage.
The particulars of the offence are set out in Annexure A to the Amended Summons. Paragraphs 5-8 of the Amended Summons refer to the incident on 12 June 2020 in which Mr Martins died. Paragraph 10 of the Amended Summons pleads that the risk was "the risk to workers, in particular Mr Martins".
Paragraph 11(a) of the Amended Summons pleads that one reasonably practicable measure which should have been taken was for Maluko to "direct its workers, including Mr Martins, not to manually operate the gate while it was damaged and had not been repaired or replaced by a competent person".
Paragraph 12 of the Amended Summons refers again to "workers" in the plural. It pleads: "As a result of the defendant's failures, workers, in particular Mr Martins, were exposed to a risk of death or serious injury".
Maluko pleaded guilty to the charge as set out in the Amended Summons during a court appearance on 3 April 2023. Thus Maluko admitted all of the matters pleaded in the Amended Summons and was to be sentenced on the basis of those pleaded matters.
It is plain that by alleging that the date of the offence was "Between 5 June 2020 and 12 June 2020" SafeWork NSW (SafeWork) has prosecuted Maluko for a continuing offence. A continuing offence is an offence which is committed "day by day so long as the state of affairs which is forbidden continues to exist, and the person responsible for creating that state of affairs is liable day by day for those offences": Sloggett v Adams (1953) 70 WN (NSW) 206 at 208.
Counsel for the prosecutor submitted that there was one offence, which was committed on 12 June 2020, being the creation of the risk leading immediately to the death of Mr Martins. That submission flies in the face of the way in which SafeWork chose to plead the Amended Summons by alleging a continuing offence.
Counsel for the prosecutor sought to argue that there was no evidence that any workers other than Mr Martins on 12 June 2020 were exposed to the risk. That submission fails on the facts. As pointed out by Senior Counsel for Maluko, the Agreed Statement of Facts (PX 1, Tab 2) contains the following in par 37: "From 5 June 2020 until the day of the incident on 12 June 2020, the Gate was opened and closed manually by various workers at the Site, including Mr Martins, as necessary when entering and/or leaving the Site. During this period there was no system of work in place for ensuring the safe manual operation of the Gate."
Senior Counsel for Maluko also pointed to the unchallenged evidence contained in par 46 of the affidavit of Mr Ferreira dated 7 July 2023 (DX 1) where Mr Ferreira said: "On 12 June 2020 after Martin's death, I was able to review the CCTV footage. I saw that on 9, 10 and 11 June 2020, Martin was the first to arrive at the Premises. I was not specifically aware that Martin was opening the gate prior to his death, however I was aware that it was his invariable practice to arrive at work prior to anyone else. The CCTV footage shows that on each of 9, 10 and 11 June 2020, Martin parked his ute in the driveway, unlocked the chain around the vehicle gate and then manually pushed the vehicle gate in a southerly direction (in the open position)."
I reject the submission of counsel for the prosecutor that the only offence disclosed is one offence committed on 12 June 2020. If this submission had been accepted, then there could be no doubt that the maximum penalty for the offence is the new figure of $1,731,500. I reject the submission because: 1. The Amended Summons pleads a continuing offence which occurred between 5 June 2020 and 12 June 2020. 2. The defendant has pleaded guilty to every matter alleged in the Amended Summons, including that the offence was committed between those dates. 3. The Agreed Statement of Facts contains an assertion that the gate was opened and closed manually between 5 June 2020 and 12 June 2020 by other workers. 4. The CCTV footage viewed by Mr Ferreira shows that Mr Martins himself manually opened the gate on 9, 10 and 11 June 2020, as well as on the fatal date of 12 June 2020.

Submissions re Maximum Penalty

Against those factual findings, I turn to consider the legal question of whether the pre-10 June 2020 maximum penalty applies, or whether the post-10 June 2020 maximum penalty applies to this one continuing offence.
Both counsel referred the court to s 19 of the Crimes (Sentencing Procedure) Act 1999 (NSW) (the CSP Act) which provides as follows: "19 Effect of alterations in penalties (1) If an Act or statutory rule increases the penalty for an offence, the increased penalty applies only to offences committed after the commencement of the provision of the Act or statutory rule increasing the penalty. (2) If an Act or statutory rule reduces the penalty for an offence, the reduced penalty extends to offences committed before the commencement of the provision of the Act or statutory rule reducing the penalty, but the reduction does not affect any penalty imposed before that commencement. (3) In this section, a reference to a penalty includes a reference to a penalty that is expressed to be a maximum or minimum penalty."
Counsel for SafeWork submitted (MFI 1, pars 2-11) that the maximum penalty for the offence committed by Maluko was the new figure of $1,731,500, becasue the offence was committed on the day that Mr Martins died, being 12 June 2020. Counsel for SafeWork submitted that it thus followed that the offence was committed after the commencement of the Amendment Act which increased the penalty. Thus by s 19(1) of the CSP Act, the increased penalty applied because the offence was committed after the commencement of the provision increasing the penalty.
Counsel for SafeWork referred the court to the decision of the Court of Criminal Appeal in R v MAJW [2007] NSWCCA 145. That case involved a sexual assault committed against a minor. The Crown was unable to nominate the particular date on which the assault was committed, but charged the defendant that it was committed between two particular dates. In the period covered by the charge, an increased penalty applied to offences committed after the commencement of the amendment increasing the penalty.
In par [27] of MAJW Justice James said: "27 With regard to counts 11 and 12, it is true that the extended period alleged in each count straddles two periods in which there were different maximum penalties. However, in such a case, if the Crown is unable to establish that the offence was committed during the period in which the higher maximum penalty applied, the offender must be sentenced on the basis of the lower maximum penalty. Difficulties could arise in a case where the Crown charges an aggravated offence, if the circumstance relied on by the Crown was a circumstance of aggravation in one period but not in the other, but such a difficulty does not arise, and need not be addressed, in the present case."
This case is different. SafeWork has alleged and established that the offence, involving exposure to a risk, occurred continuously from 5 June 2020 to 12 June 2020.
I reject the submission made by counsel for SafeWork that the offence with which Maluko is charged occurred only on 12 June 2020. I have set out above my reasoning, which relates both to the way in which the charge has been pleaded (as a continuing offence) and as to facts established at the sentencing hearing which show that the risk existed both before and after 10 June 2020, when the penalty was increased by the Amendment Act.
Senior Counsel for Maluko submitted as follows: 1. Section 19(1) of the CSP Act provides that the increased penalty applies only to offences committed after the commencement of the provision increasing the penalty. However, in the present case the offence was one committed both before and after, and thus s 19(1) of the CSP Act has no application. I accept that submission. 2. Section 19(1) of the CSP Act is a beneficial provision and thus should be construed beneficially. In submissions there was no identification of the way in which s 19 could be construed so as to apply where the increased penalty came into force during the commission of the offence, rather than coming into force after the commission of the offence. 3. To apply the increased maximum penalty in the present case offends the principles of perceived fairness applicable to maximum and minimum penalties upon which s 19 of the CSP Act is based. In R v MJR [2002] NSWCCA 127 at [27]; (2002) 54 NSWLR 368, Spigelman CJ said: "Section 19 of the Crimes (Sentencing Procedure) Act 1999 and its predecessor [s 55 of the Interpretation Act 1987 (NSW)] reflects a principle of perceived fairness applicable to maximum and minimum penalties, which it is appropriate to adopt for other aspects of the exercise of the sentencing discretion."
However, the principle of perceived fairness to which the Chief Justice referred was one which operated in the context of an offence being complete by a date before a statutory increase in penalty. 1. The majority of the period of the offending behaviour (5 June to 10 June 2020) took place before the legislature increased the maximum penalty. That is so, but since there can be no apportionment of maximum penalty, the submission does not provide an answer to the legal problem. 2. If the prosecution had wanted to ensure that the increased maximum penalty applied, it could have limited the period alleged in the charge to 10-12 June 2020, or confined it only to 12 June 2020. SafeWork chose not to do so. This is undoubtedly correct, but it still leaves open the question of which maximum penalty applies.

Authorities relevant to Continuing Offences

Neither counsel cited an authority directly relevant to the increase of a maximum penalty during the period of a continuing offence.
It seems to me that the answer to the question of which maximum penalty applies is to be found in the decision of the Court of Criminal Appeal in R v Mark White (BC9101745, Court of Criminal Appeal (NSW), Gleeson CJ, Lee and Hunt JJ, 25 July 1991, unreported).
Two defendants were sentenced by different judges of the District Court in relation to charges of conspiracy to defraud the Commonwealth. Mr Kruger was sentenced by a judge who regarded the maximum penalty for the offence as three years (a matter advanced by both the Crown and the accused before that judge). Mr White was sentenced by a different judge, who took the view that the maximum penalty was five years.
The conspiracy charged was one which took place between May 1984 and January 1985. As at May 1984 s 86(1)E of the Crimes Act 1914 (Cth) which provided for the offence of conspiracy to defraud the Commonwealth fixed a maximum of three years imprisonment. On 25 October 1984 s 86(1)E was omitted from the Crimes Act and s 86A was inserted, fixing the maximum penalty at five years. The court held that a conspiratorial agreement continues in operation and therefore in existence until it is terminated. The offence of conspiracy was held to be a continuing offence. The court held that s 86A (and thus the new maximum penalty of five years) applied to an existing conspiracy because there was one offence, being a continuing offence.
The court thus held that the sentencing judge in relation to Mr White correctly found that the maximum penalty for the offence was five years and not three years.
The leading judgment in the case was that of Justice Lee. Chief Justice Gleeson and Justice Hunt agreed with Justice Lee for the reasons which he gave.
It is to be noted that the case of White was decided well before s 19 of the CSP Act. However, s 55 of the Interpretation Act 1987 (NSW) was in force at the time of the decision in White and was in precisely the same terms as s 19 of the CSP Act. Section 55 of the Interpretation Act was later repealed and simply transposed into s 19 of the CSP Act in 1999.
The Court of Criminal Appeal in White made no reference to s 55 of the Interpretation Act. The absence of such a reference reinforces the conclusion which I have reached above, which is that s 19 of the CSP Act has no application where a maximum penalty is increased during the term of a continuing offence.
The Court of Criminal Appeal did say (at p 11) that where there is one penalty at the commencement of a conspiracy and a hgher penalty is legislated during the conduct of the conspiracy, "it would not be inappropriate for a sentencing judge to bear in mind that the level of the penalty has increased over the period of the conspiracy, and to put that consideration into effect in fixing any sentence which he ultimately imposed".
In R v Annecchini (BC9601668, Court of Criminal Appeal (NSW), Gleeson CJ, Allen and James JJ, 24 April 1996, unreported) the appellant pleaded guilty to a single charge of defrauding the Department of Social Security over a period from 25 October 1984 to 7 April 1995. During that period, on 1 October 1986, the legislation was altered to increase the maximum penalty for the relevant offence from five years imprisonment to ten years imprisonment. Gleeson CJ (at p 4) rejected the submission that the lower maximum penalty applied, following his own reasoning in White.
White was applied by the Land and Environment Court in Environment Protection Authority v Unomedical Pty Limited (No 4) [2011] NSWLEC 131 and Environment Protection Authority v Port Stephens Council [2011] NSWLEC 209. In each case, the defendant breached a provision of the Protection of the Environment Operations Act 1997 (NSW) for a period commencing before May 2006 and continuing thereafter. On 1 May 2006, the maximum penalty for a corporation was increased from $250,000 (and for continuing offences, $120,000 for each day the offence continues) to $1,000,000 (with the maximum daily penalty for a continuing offence remaining the same). Craig J and Pepper J respectively each cited White in concluding that bthe higher maximum penalty of $1,000,000 applied.

Conclusion

The decision in White is a binding authority for the proposition that, in the case of a continuing offence, where there is an increase in the maximum penalty during the course of the commission of the offence, the increased maximum penalty is applicable.
I find that the maximum penalty applicable to Maluko in these proceedings is a fine of $1,731,500.

The Risk

The risk described in par 10 of the Amended Summons is as follows: "10. The risk was the risk to workers, in particular Mr Martins, suffering serious injury of death as a result of the damaged Gate falling on them and thereby striking or crushing them while attempting to manually operate the Gate at any time after the motor vehicle incident."

Reasonably Practicable Measures

Paragraph 11 of the Amended Summons pleads particulars of the defendant's failure to comply with the duty under s 19(1) of the WHS Act as follows: "11. The defendant failed to ensure so far as is reasonably practicable the health and safety of workers generally, and in particular Mr Martins, in that it failed to take one or more of the following reasonably practicable measures to eliminate or alternatively minimise, if it was not reasonably practicable to eliminate, the risk: (a) Direct its workers, including Mr Martins, not to manually operate the Gate while it was damaged and had not been repaired or replaced by a competent person. (b) Direct that the damaged Gate remain opened and unlocked so as to allow access to the Site during the period prior to its replacement or repair by a competent person. (c) Develop and implement a safe system of work for operating and/or using the damaged Gate during the period prior to its replacement or repair by a competent person. (d) Develop and implement a safe work method statement or safe work procedure for the manual operation of the Gate. (e) Train and instruct its workers, including Mr Martins, in the safe system of work and the safe work method statement or procedure identified in (c) and (d). (f) Raise safety concerns with the Owners Corporation at the Site and/or with the appointed Strata Manager of the Site about the daily routine of workers manually operating the damaged Gate."

Background

The parties presented an Agreed Statement of Facts (PX 1, Tab 2) and this material is summarised below.
Maluko's business or undertaking involved building and concreting services. It operated its business or undertaking at an industrial complex at 161 Berkeley Road, Berkeley NSW (the site). The site was comprised of eight units. Maluko leased Unit 5 at the site.
Maluko employed five workers, including Mr Jose Martins and Mr Steven Ferreira. Mr Ferreira was the manager and sole director.
The common property at the site was managed and controlled by the Owners Corporation Strata Plan 93899 (the Owners Corporation). Pursuant to ss 106(1) and (2) of the Strata Schemes Management Act 2015 (NSW) the Owners Corporation had duties to properly maintain and keep in a state of good and serviceable repair the common property at the site and to renew and replace any fixtures or fittings comprised in the common property.
In 2019 the Owners Corporation executed an agreement appointing Chris Darby Strata Pty Ltd (Chris Darby) as the strata managing agent for the site. The agreement gave Chris Darby complete authority to effect repairs, maintain common property and engage qualified people to carry out repair work at the site. Chris Darby employed Ms Johnson as a strata manager. Ms Johnson was responsible for the day-to-day management of the site. She took instructions from Mr Mario Perossa who acted on behalf of the Owners Corporation.
A perimeter fence had been installed around the site as well as a custom-built, sliding electric gate. The gate was common property. It was eight and half metres long and two metres high. Guideposts and an end-stop (the stopper) were installed to prevent the gate from overtravel in the closing direction. The gate was fitted with a sensor which caused the electric motor to stop as soon as the gate hit any obstructions, including the stopper. Each unit owner or tenant at the site had a remote control pendant which operated the gate.
Access to the site was also possible through a pedestrian gate which was manually operated using a wire rope with a padlock.

Damage to the Gate

On the night of 4 June 2020 a van collided with the gate at high speed. The gate remained upright but was bent out of shape, partially pulled off its track and disconnected from its electric motor. The guideposts fitted with support rollers at the northern end of the gate were also damaged. The stopper had come out of its position and was no longer capable of preventing overtravel of the gate past the guideposts and support of the rollers. As a result, the damaged gate presented a risk of falling.
Following the collision, the gate was not repaired, replaced, made safe or otherwise attended to.
On 5 June 2020 a number of occupants, not including Maluko, attempted to undertake makeshift repairs to the gate. These repairs did not remediate the damage to the gate nor eliminate or otherwise address the risk of the gate falling or collapsing.
From 5 to 12 June 2020 the gate was manually opened at the beginning of each workday and manually closed at the end of the day. The gate was left either completely or partially open during the day.

The Incident

At about 5.45am on 12 June 2020 Mr Martins arrived at the site. His daily routine involved opening the gate and Maluko's workshop prior to the arrival of the other workers. The workshop was inside the site. Prior to 4 June 2020 the gate was operated by a remote control that activated the electric motor.
Mr Martins drove his vehicle up to the entrance at the site and alighted from his car. The gate was padlocked. Mr Martins unlocked the gate and attempted to manually push it open. The lack of stopper allowed the gate to move too far in the closing direction, to the point where it came out from its guideposts and supporting rollers. Once out of the rollers the gate fell against a post, which was one of the temporary repairs made to the fence. The gate was resting at an angle and no longer aligned with the supporting rollers.
Mr Martins attempted to move the gate back into position between the supporting rollers but it became unstable and fell onto him. The gate pinned him to the ground until the other workers arrived at the site about 15 minutes later and lifted it off him. The incident was recorded on CCTV footage (PX 1, Tab 5).
Mr Martins suffered fatal injuries as a result of the incident. He was 64 years old.

Systems of Work Prior to the Incident

The gate system included a pair of vertical guideposts on each side of the driveway and a stopper. The guideposts were taller than the gate and formed a physical barrier against the gate falling to the ground. The stopper prevented the gate from travelling beyond the guideposts and support rollers. The motor was at the southern end of the gate and pulled the gate open in that direction but only to a set distance.
After the vehicle collision on 4 June 2020 the gate was no longer able to be operated in this manner. The gate had become disconnected from the motor and the northern end guideposts were destroyed. There was no adequate system in place for ensuring the gate was attended to, repaired or made safe after it was damaged. There was no process or procedure in place for assessing the damage to the gate as a result of the collision.
From 5 to 12 June 2020 the gate was manually opened and closed by workers at the site as necessary. During this period there was no system of work in place to ensure the safe manual operation of the gate. No risk assessment had been done in relation to the presence of the damaged gate or in relation to its manual operation. There was no Safe Work Method Statement (SWMS) or safe work procedure developed for the manual operation of the gate. Nor was any training or information provided to workers at the site in relation to the safe manual operation of the gate.
The damaged gate was not locked out or otherwise removed from service to prevent it from being manually operated. There was no system in place for ensuring the gate was tagged out or otherwise taken out of service to prevent it from being used until proper repairs had been carried out.
The Owners Corporation reported the damaged gate to Chris Darby in the morning following the collision. Ms Johnson received approval from Mr Perossa to arrange repairs to the gate and fence. That same morning on 5 June 2020, she issued a work order to iAutomate Gates and Doors (iAutomate) to repair the damage but did not inform them of any urgency.
Neither Chris Darby nor the Owners Corporation carried out or otherwise arranged for an immediate risk assessment to be conducted in relation to the damage done to the gate.
Chris Darby did not communicate to the workers at the site that the damaged gate should not be manually operated unless and until such operation was deemed safe by a competent person. Chris Darby did not confirm with the Owners Corporation the required timeframes for the repair work.
The Owners Corporation did not remove the gate from service or post a sign to the effect that it was not operational pending its full repair or replacement. The Owners Corporation did not take any action to prevent the manual operation of the damaged gate or prevent the makeshift repairs to the gate, which permitted the manual operation of the gate, from being carried out. The Owners Corporation did not inform Chris Darby of the need for urgent repairs, nor did it follow up with Chris Darby when a competent person did not attend the site promptly and while the gate was being manually operated.
Maluko did not take reasonably practicable steps to ensure that the damaged gate, as part of its workplace, was safe and without risks to the health and safety of its workers, including Mr Martins. Maluko required and permitted Mr Martins to manually open the gate each work morning after the collision despite it being unsafe. Maluko did not raise concerns directly with the Owners Corporation or with Chris Darby about the ongoing manual operation of the damaged gate. Maluko did not develop a safe system of work for manually operating the gate in the period between the collision and the incident.

Guidance Material

The following guidance material was available at the time of the incident: 1. The Code of Practice, Managing the Risks of Plant in the Workplace, August 2019 (PX 1, Tab 14). Part 3.6 provides that plant with damage that poses a risk to health and safety should be withdrawn from service until those risks have been controlled. 2. The Code of Practice, Managing the Work Environment and Facilities, August 2019 (PX 1, Tab 13). Part 1.1 provides specific guidance to entities having responsibilities under s 19 of the WHS Act. Part 1.3 provides guidance on the need for prompt replacement or repair of damaged fixtures and fittings within the work environment. 3. A Western Australian Safety Alert published in August 2019 (PX 1, Tab 15), which provided: 1. "When an incident occurs that results in damage to a gate or when it is identified that a gate is not working correctly, the gate should be immediately tagged out and the employer property owner and/or property manager notified." 2. "Any damaged or defective gates should be immediately assessed and repaired by a competent person." 3. "Until such repairs are completed, measures must be implemented to keep people away from a damaged gate (for example by temporary barricades, exclusion zones, warning signs)."

Systems of Work Following the Incident

The gate was removed by crane on 12 June 2020. In late September 2020 a new automatic electric gate was installed at the site.

Evidence for the Defendant

Mr Steven Ferreira swore an affidavit on 7 July 2023 (DX 1). He is the sole director of Maluko.
Mr Ferreira also referred to and relied on a bundle of documents marked "Exhibit SF01" (DX 2).

Maluko

Maluko was registered as a company in February 2014. It provides building and concrete services for residential houses, duplexes and light commercial properties. Maluko is a tenant of Unit 5 at the site where it operates its business.
In 2017 Maluko developed the industrial complex comprised of eight units at Berkeley. The eights unit operated under a strata scheme managed by Chris Darby. Under the Strata Management Agreement, Chris Darby was responsible for carrying out any repairs or maintenance works to the site. The owners of Lots 7 and 8 were the committee members responsible for liaising with the strata manager. In particular, Mr Perossa was the elected strata committee member.
In 2018 the Owners Corporation resolved to put in place a "Maintenance Authorisation Procedure" under which the strata manager is authorised to proceed with any work to common property that constitutes an emergency.

Mr Martins

Mr Ferreira and Mr Martins met in 1982. Mr Martins was employed by Maluko as a concrete finisher. He worked Monday to Saturday from about 6.30am or 7.00am to about 3.30pm or 5.00pm. His start and end times varied depending on the work Maluko was doing. Mr Martins usually attended the site earlier than his required start time because he left for work at the same time as his wife.
Mr Martins' responsibilities included opening the workshop and getting the tools ready. Mr Martins did not have a remote control to open the gate. He would wait for Mr Esteves, another Maluko worker, to arrive and open the gate. Except for the period from 5 to 12 June 2020, Mr Martins accessed the site by using a key to unlock the pedestrian gate adjacent to the gate.

The Gate

Prior to being damaged, the gate was remote operated. Mr Ferreira and Mr Esteves each had a remote control. No other Maluko worker had a remote control.
The gate was purchased from Alam Fabrications in May 2017 and installed by Mr Ferreira. The gate's standard safety features include an "H" bracket (ie two vertical posts with a horizontal end-stop between) at each end and a "limit switch" at the end of each gear racking, which stops the motor when the motor sprockets get to the end of the gear racking.

The Collision

On 4 June 2020 at about 9.30pm, a van crashed into the gate. Mr Ferreira was not present at the time but is aware that emergency services attended the scene. The gate was not secured after the collision.
The damage to the gate was mainly at the northern or "closing end" of the gate. The gate was bent and a number of rails which the electric cog drives from the electric motor had been sheared off. The tunnel which the gate normally closed into at the northern end was destroyed. There was no physical stop at the end of the track to prevent the gate from overtravel when moving in the northerly (closing) direction. The pedestrian gate was also destroyed. (The extent of the damage can best be appreciated by viewing the post-incident photos in PX 1).
Mr Ferreira did not directly contact the strata manager in relation to the damaged gate. He is aware that a committee member or owner at the site informed the strata manager on the morning of 5 June 2020 but he did not know who at the time. He recalls a tenant or owner at the site informing him that the strata manager wanted photos of the gate.
Mr Ferreira was aware that some of the owners at the site intended to temporarily fix the gate until it could be properly repaired. He saw two people attempting to repair the gate. However, he did not see the temporary repairs and when he left the site on 5 June 2020, the temporary repairs had not been carried out.

The Incident

Maluko did not work from 6 to 8 June 2020 as it was a long weekend. There were also COVID-19 restrictions in force. The construction industry was permitted to operate but outdoor gatherings were otherwise limited. Mr Ferreira did not attend the site after 5 June 2020 until 12 June 2020, because he was not planning on working during the week following the long weekend.
At the time Maluko was working on a house build in Berry, NSW. Four Maluko workers were working at the site, including Mr Martins.
On 12 June 2020 Mr Ferreira received a call at about 5.58am from Mr Esteves who had discovered Mr Martins. Mr Ferreira attended the site at about 6.20am at which time the gate had already been removed and put to the side. Mr Ferreira called Chris Darby that morning and told a woman on the phone what had happened because they had not fixed the gate. The woman said she would call him back. He did not receive any communication from Chris Darby.
On 12 June 2020 Mr Ferreira reviewed the CCTV footage. It shows that on each day from 9 to 11 June 2020, Mr Martins parked his vehicle in the driveway, unlocked the chain around the gate and then manually pushed the gate in a southerly direction (ie into the open position). On 12 June 2020 the gate did not slide back in the southerly direction to its usual open position. Mr Martins then attempted to move the gate in a northerly direction towards the pedestrian gate. Mr Ferreira does not know how Mr Martins got onto the site given that the pedestrian gate was not accessible nor how he obtained a key for any chain to the gate, if in fact he did.

Remorse

Mr Ferreira stated that he is aware that the gate should have been removed and repaired as a priority. He also expressed his personal grief over the loss of his close friend and employee. He has seen Mr Martins' wife and daughter on numerous occasions since Mr Martins' death.

Prior WHS Actions

Mr Ferreira regularly held toolbox talks discussing safety issues.
Maluko had various SWMSs for the work that Maluko carried out. There was no SWMS for the operation of the vehicle gate.
Maluko's WHS Management Plan included the following: "To prevent their inadvertent use, plant and equipment shall be isolated or taken out of service when either a fault or defect is found."

Action Subsequent to the Incident

Following the incident mental health support was provided to Maluko employees.
The Improvement Notice and the Prohibition Notice issued to Chris Darby was complied with by removal of the gate.
Mr Ferreira acknowledged that he could have done the following: 1. Better educated the workers on identifying the potential hazards associated with large, heavy gates. 2. Ensured the strata manager carried out the repair of the gate. 3. Put in place alternatives to operating the gate while it was damaged. 4. Ensured the gate was tagged out. 5. Educated the workers on risk assessment and training in a procedure for manually opening the gate and fixing a temporary obstruction onto the track to block the path of the wheel until more effective repairs could be undertaken.
Mr Ferreira has read and appreciated the abovementioned guidance material, particularly the sections on risk assessments. Further he understands that the Western Australian Safety Alert required him to insist that the damaged gate was taken out of service until it was repaired.

Financial Capacity

Contained within DX 2 are copies of Maluko's Tax Returns. In summary: 1. In 2019-20 Maluko made a loss of $57,252. 2. In 2020-21 Maluko made a profit of $88,062. 3. In 2021-22 Maluko made a loss of $650,734.
The loss in financial year 2021-22 is a result of inflation affecting material costs and a downturn of work as a result of COVID-19. Inflationary costs have now settled and for financial year 2022-23 Maluko is expecting a gross operating profit between $120,000 and $150,000.
Maluko's gross revenue is approximately $2,000,000 per year. However, the majority of that turnover goes to covering the costs of materials, wages and running the business. Mr Ferreira did not draw a wage for the 2022-23 financial year.
Mr Ferreira does not consider that Maluko has the capacity to pay a substantial fine by itself. He believes he will most likely cover the cost personally.
Mr Ferreira has two personal bank accounts containing $12,054.67 and $27,619.03 respectively. Mr Ferreira also received a personal loan of $210,000 from his godfather Mr Esteves to assist the cashflow of Maluko for homeowner insurance. These funds were transferred to Maluko's business account.
Mr Ferreira also owns land in Horsley, NSW, which he acquired in 2021 for about $400,000. He is currently in the process of developing the land into duplexes. There are currently two loans on that property, being $328,000 and $495,012.40 respectively. The first loan was taken out to purchase the land and the second loan was taken out to fund the development of the land.
Completion of the duplexes is projected to be completed in August 2023. Mr Ferreira is undecided whether he will rent out or sell the properties. The asking price for each duplex would be about $850,000. Alternatively, the rental price would be about $725 per week. Mr Ferreira expects a net profit of about $200,000 if both duplexes were to sell in or around August 2023.

Consideration

I have had regard to the objects in s 3 of the WHS Act and the purposes of sentencing set out in s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW).

Objective Seriousness of the Offence

The proportionality principle requires that a sentence should neither exceed nor be less than the gravity of the crime having regard to the objective circumstances: Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465 at 472, 485-6, 490-1 and 496. At common law, the term "objective circumstances" was used to describe the circumstances of the crime. The gravity of the offence was assessed by reference to its objective seriousness: R v McNaughton [2006] NSWCCA 242; (2006) 66 NSWLR 566 at [15].
The task requires the court to consider where in the range of conduct covered by the offence the conduct of the offender falls: Baumer v R [1988] HCA 67; (1988) 166 CLR 51 at 57. This assessment will generally indicate the appropriate range of sentences available which will reflect the objective seriousness of the offence committed, and set the limits within which a sentence proportional to the criminality of the offender will lie: BW v R [2011] NSWCCA 176 at [70].
In Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120 at [27] the High Court said: "The objective seriousness of an offence is to be assessed without reference to matters personal to a particular offender or class of offenders. It is to be determined wholly by reference to the nature of the offending."
The sentencing judge should take into account not only the conduct which actually constitutes the crime, but also such of the surrounding circumstances as are directly related to that crime and are properly regarded as circumstances of aggravation or mitigation: R v Wilkinson (No. 5) [2009] NSWSC 432 at [61].
The existence of a reasonably foreseeable risk to safety that is likely to result in serious injury or death is a factor relative to the gravity of the offence: Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 at [82]. The question of foreseeability of the risk is to be determined objectively.
The court must identify all the factors that are relevant to the sentence, discuss their significance and then make a value judgment as to what is the appropriate sentence given all the factors of the case: Muldrock. This approach to sentencing, known as the "instinctive synthesis" approach, involves the making of a global judgment without any attempt to state precisely how any given factor has influenced the judgment.
The Court of Criminal Appeal has examined the sentencing process with regard to the WHS Act in the matter of Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96. Justice Basten at [34], under the heading "Assessment of Risk" said: "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 an event 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."
Further at [42] his Honour continued: "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 [event] 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, which were not even assessed, were straightforward and involved only minor inconvenience and little, if any, costs."
At [53] his Honour dealt with the proper approach to considering the objective seriousness of offences under the WHS Act, saying: "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 materialize. The objective seriousness of the conduct will also be affected by the ease with which mitigating steps could have been taken."
My findings about the defendant's level of culpability are based upon the following: 1. The risk of the gate falling was foreseeable, particularly to Maluko which had developed the site and installed the gate in the first place. Even a cursory inspection of the rough and ready temporary repairs would have led to the realisation that there was no end stop and the gate could slide past the southern rollers and then fall. Further there was Guidance Material which disclosed the risk. 2. The likelihood of the risk occurring was significant. This is particularly illustrated by the CCTV of the incident, which shows that Mr Martins had to wrestle with the gate to get it to move. 3. The potential consequences of the risk were serious injury or, as happened, death. 4. There were simple no-cost steps available to eliminate or minimise the risk. 5. There was no burden or inconvenience involved in those steps. 6. The death of Mr Martins was caused by the breach of safety duty by Maluko. 7. This was a continuing offence and the evidence shows that workers were exposed on several days to the risk, not just on 12 June 2020. 8. The maximum penalty for the offence is a fine of $1,731,500, which reflects the legislature's view of the seriousness of the offence. In accordance with the decision in White referred to above, I will take into account in setting the penalty that the maximum penalty increased from $1,500,000 to $1,731,500 during the seven days of the continuing offence, and only two days before the incident. 9. The default of other parties arguably made a contribution to the creation of the risk and the death of Mr Martins. However, Maluko had its own independent safety duty under the WHS Act. While Maluko could not have performed repairs on the gate (which was owned by the Owners Corporation), it had an obligation to protect its workers by the giving of a simple direction not to move the gate manually. Further, as a business involved in the construction industry and as the original installer of the gate, it had the expertise to perceive that the ad hoc repairs left the gate in a dangerous state for anyone in its vicinity.
I find that the level of culpability of Maluko is in the mid range.

Deterrence

The penalty imposed in relation to this offence must provide for general deterrence. Employers must take the obligations imposed by the WHS Act very seriously. The community is entitled to expect that both small and large employers will comply with safety requirements. General deterrence is a significant factor when safety obligations are breached: Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338 at [180].
The penalty must reflect the need for specific deterrence. Maluko is still conducting a business. Its operations involve building and concreting services and the continuing engagement of workers.

Aggravating Factors

The injury, emotional harm, loss or damage caused by the offence was substantial: s 21A(2)(g) Crimes (Sentencing Procedure) Act 1999.

Mitigating Factors

Maluko has no previous convictions: s 21A(3)(e) Crimes (Sentencing Procedure) Act 1999.
Maluko is otherwise of good character: s 21A(3)(f) Crimes (Sentencing Procedure) Act 1999. The steps which it took after the incident demonstrate this. Maluko had been in business for approximately six years at the time of the incident.
Maluko is unlikely to re-offend: s 21A(3)(g) Crimes (Sentencing Procedure) Act 1999.
Maluko has good prospects of rehabilitation: s 21A(3)(h) Crimes (Sentencing Procedure) Act 1999. It has taken positive steps to guard against the risk of an incident such as this ever happening again. It has brought its documentation and its procedures into line with those which, on all the evidence, should have been in place before this incident occurred.
Maluko has shown remorse for the offence: s 21A(3)(i) Crimes (Sentencing Procedure) Act 1999. It has provided evidence that it has accepted responsibility for its actions and has acknowledged that the death of Mr Martins was caused by its actions.
Maluko entered a plea of guilty: s 21A(3)(k) Crimes (Sentencing Procedure) Act 1999. The court must take into account the fact that the offender has pleaded guilty, when the offender pleaded guilty, and the circumstances in which the offender indicated an intention to plead guilty: s 22(1) Crimes (Sentencing Procedure) Act 1999. It is appropriate to give Maluko a 25% discount for an early plea.
Maluko gave assistance to law enforcement authorities: s 21A(3)(m) Crimes (Sentencing Procedure) Act 1999. It cooperated at all times with the prosecutor and provided all documents requested in a prompt fashion.

Capacity to Pay a Fine

I am required to have regard to s 6 of the Fines Act 1996 (NSW) before imposing a fine. Where an offender seeks to have a fine reduced on the basis of a limited capacity to pay, it bears the evidentiary onus of convincing the court that it should exercise its discretion to limit the amount of the fine. The offender's capacity to pay is relevant but not decisive: Mahdi Jahandideh v The Queen [2014] NSWCCA 178 at [16]. A substantial fine may still be warranted as a result of the seriousness of the offence and the need for general deterrence.
In Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266 at [79] the Court of Criminal Appeal said: "First, and more generally, questions of specific deterrence should take into account the size and scope of the operations of the defendant; a fine which may be crippling to a small business may have virtually no impact on the financial operations of a large corporation. The maximum penalty for the offence is undoubtedly set having regard to such a factor. Secondly, the Court is required to have regard to 'the means' of the defendant, pursuant to s 6 of the Fines Act 1996."
I take into account the modest size and profits of Maluko's business and I will moderate the fine which I would otherwise impose. Maluko appears to be returning to profitability. Further, it has access to financial resources which can be provided by Mr Ferreira.

Costs

The parties have agreed to an order that the defendant is to pay the prosecutor's costs in the amount of $44,000.

Penalty

My orders are: 1. Maluko Pty Ltd is convicted. 2. The appropriate fine is $500,000 but that will be reduced by 25% to reflect the early plea of guilty. 3. Order Maluko Pty Ltd to pay a fine of $375,000. 4. Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor. 5. Order Maluko Pty Ltd to pay the prosecutor's costs agreed in the amount of $44,000. 6. Exhibits to be returned.

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: 26 July 2023

Environment Operations Act 1997(NSW)

Work Health and Safety Amendment (Review) Act 2020(NSW)

R v Wilkinson (No. 5) [2009] NSWSC 432 Sloggett v Adams (1953) 70 WN (NSW) 206 at 208 Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266 Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465 Texts Cited: Code of Practice, Managing the Risks of Plant in the Workplace, August 2019 Code of Practice, Managing the Work Environment and Facilities, August 2019 Western Australian Safety Alert, August 2019 Category: Sentence Parties: SafeWork NSW (Prosecutor) Maluko Pty Ltd (Defendant) Representation: Counsel: M Moir (Prosecutor) R Pontello SC with M Barnes (Defendant)

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