SafeWork NSW v Royal Demolition & Excavation Pty Limited

District Court of NSW|2020-10-07

T Hammond (Prosecutor) S Kassem (Solicitor) (Defendant)

Solicitors: SafeWork NSW (Prosecutor) FutureLegal (Defendant) File Number(s): 2019/158625

Judgment

On 26 May 2017 the offender was carrying out ground levelling work following the completion of demolition work working at a site at East Killara. While a 23-tonne excavator was being reversed, a 16 year old labourer, who had bent over to tie his shoelace, slipped and was run over by the excavator.
Royal Demolition & Excavation Pty Limited (Royal Demolition) has pleaded guilty to an offence that as a person who had a work health and safety duty pursuant to s 19 of the Work Health and Safety Act 2011 (NSW) (the Act) it failed to comply with that duty and thereby exposed Hassan Alameddine to a risk of death or serious injury contrary to s 32 of the Act.
The maximum penalty for the offence is a fine of $1,500,000.

Background

The parties presented an Agreed Statement of Facts and this material is summarised below.
Royal Demolition was a corporation in the business or undertaking of providing demolition and excavation services in New South Wales.
The directors of Royal Demolition were Mr Maher El Masri and Ms Sanaa Choubasi. Ms Choubasi did not take an active role in the company. Mr El Masri was responsible for the retention and organisation of work for Royal Demolition.
Mr Hassan Alameddine was employed as a labourer with Royal Demolition. He commenced employment with Royal Demolition approximately four weeks prior to 26 May 2017. He was paid $150 in cash daily. When the incident occurred Mr Alameddine was 16 years old. Mr Alameddine held a construction white card, which he had obtained while working for a previous employer.
Mr Wassim Choubassi was engaged by Royal Demolition as an excavator operator.
On 29 January 2017 Royal Demolition provided a quote to Salycon Pty Limited (Salycon), the owner of a property located at 71-73 Koola Avenue East Killara (the Site) to carry out demolition work and shrub removal.

Plant and Equipment

Royal Lion Transport Pty Limited (Royal Lion) purchased a used Komatsu 23-tonne excavator Model PC228USLC-3 (the excavator) on 14 November 2016. Mr El Masri was a director of Royal Lion. Under a lease agreement dated 4 March 2017, Royal Lion supplied the excavator to Royal Demolition on an ongoing basis.
As at 26 May 2017, the excavator was in poor condition and had broken, non-functional mirrors on both sides of the excavator and there was no reversing alarm.

The Site

Royal Demolition commenced work at the Site in early May 2017. Mr Alameddine commenced work at the Site on 12 May 2017.
By 26 May 2017 demolition work had concluded at the Site and Royal Demolition had commenced site preparation consisting of ground levelling work with the excavator. Mr Alameddine was working on separating materials into piles and cleaning up the Site. Mr Choubassi was operating the excavator to level the ground.

The Incident

At approximately 1.00pm on 26 May 2017 Mr Alameddine bent down to tie his shoe and slipped over as the excavator was reversing. The 23-tonne excavator struck and ran over Mr Alameddine. Mr Alameddine's body was compressed into the soft, muddy ground.
Mr El Masri was present at the Site at the time but did not witness the incident.

Injuries

As a result of being run over by the excavator, Mr Alameddine sustained life-threatening injuries to his pelvis, internal organs, legs and hands. As at 21 March 2019 he was still being assessed in relation to his claim for workers compensation.

Systems of Work Before the Incident

Royal Demolition did not conduct an adequate risk assessment of the hazards and risks arising from demolition and ground levelling work. In particular, it did not assess the risks involved in using the excavator at the Site nor did it arrange for a qualified person to conduct such a risk assessment.
In response to a notice issued under s 155 of the Act, Royal Demolition provided a document dated 26 May 2017 entitled "Site Risk Assessment & Record of Excavation Assessment". This document noted the following: 1. Under the heading "Mobile Plant near Overhead Powerlines" the words "Spotter required" were circled. The name of the Spotter was identified as "Hassan Alameddine". 2. Under the heading "Other Safety Controls" the word "N/A" was circled, but the words "Barricading required" and "Traffic Management required" were not circled. 3. Under the heading "Personal Protective Equipment (PPE)" the word "Yes" was circled, but the words "High visibility vests" were not.
Had an adequate a risk assessment been conducted, it would have identified the risks involved and the appropriate control measures to eliminate, or minimise, the identified risks.
In response to a notice issued under s 155 of the Act, Royal Demolition provided a document dated 4 May 2017 and entitled "Safe Work Method Statement" (SWMS). That document was generic and noted only the following in relation to the identified task of "Operation of Machinery" and hazards and risks of "Machine bucket striking site worker":

All site personnel to wear hard hats, high visibility vests and safety boots/gumboots;
Do not stand near machinery when in operation (15 metres clear).

The SWMS identified Mr El Masri as the person responsible for ensuring compliance with it. The SWMS was not signed by Mr Alameddine.
Royal Demolition did not establish and enforce an exclusion zone around the excavator. Royal Demolition could have put an exclusion zone in place by the use of star pickets, barricades, bunting, mesh or other similar materials so that: 1. people would have been prevented from entering the area in which the excavator was operating; and 2. materials used to delineate the exclusion zone would have acted as a visual warning to people in the vicinity of the excavator signalling that they should avoid coming within the area in which the excavator was operating.
Royal Demolition did not provide or enforce the use of personal protective equipment (PPE), such as a high visibility (hi-vis) vest. Mr Alameddine was asked to attend the Site with own hi-vis clothing and safety boots but was not wearing them at the time of the incident.
Mr Alameddine was not being directly supervised at the time of the incident. Mr Alameddine was a young, vulnerable worker at the time and had relatively little experience working in demolition or construction. Royal Demolition should have directly supervised Mr Alameddine while he was working in the vicinity of the excavator.
Royal Demolition did not provide information, training and instruction to Mr Alameddine about the need to wear hi-vis clothing when working in the vicinity of the excavator. Royal Demolition also did not provide information, training and instruction to Mr Alameddine about the need to establish and observe an exclusion zone around the excavator. He was only given a general instruction to keep "a few metres away" from an excavator.
As previously recited, the excavator was in poor condition and had broken mirrors. The reversing alarm, which warns workers that the excavator is reversing, was not working. Royal Demolition should have used an excavator which had all its safety features intact and warning devices in operation.

Legal Obligations, Codes of Practice and Guidance Material

Royal Demolition had a legal obligation under cl 34 of the Work Health and Safety Regulation 2011 (the Regulation) which requires a duty holder, in managing risks to health and safety, to identify reasonably foreseeable hazards that could give rise to risks to health and safety.
Clause 35 of the Regulation requires that a duty holder must, in managing risks to health and safety, eliminate risks to health and safety so far as is reasonably practicable, and if it is not reasonably practicable to eliminate risks to health and safety, minimise those risks so far as is reasonably practicable.
Clause 36 of the Regulation also provides that if it is not reasonably practicable for a duty holder to eliminate a risk then they must implement control measures including isolating the hazard to minimise the risk.
Clause 39 of the Regulation states that a person conducting a business or undertaking must ensure that information, training and instruction provided to a worker is suitable and adequate having regard to the nature of the work, the risks and the control measures implemented.
Guidance materials were available in the public domain on the SafeWork NSW and SafeWork Australia websites. They included: SafeWork Australia Code of Practice on "How to Manage Work Health and Safety Risks" (December 2011); WorkCover NSW Code of Practice on "Managing the risks of plant in the workplace" (July 2014); WorkCover NSW Code of Practice on "Excavation work" (July 2015); WorkCover NSW Code of Practice for Moving Plant on Construction Sites (2004) (Plant Code).
Of particular relevance, the Plant Code said that powered mobile plant is extremely hazardous when operated in situations where: 1. There are people or other vehicles sharing the same site or roadway. Pedestrians and bystanders are particularly vulnerable in zones where mobile plant and machinery is operated as the operator's vision may be restricted and plant, which is apparently idle, may move with little warning; 2. The plant is poorly maintained; 3. Any other work is carried out near the work area.
The Plant Code provides that the following measures should be considered to control the risk of moving plant colliding with persons on site: 1. Isolating vehicles and plant used in or around the site and work area from persons on the site or work area. For example, vehicles or persons may be guided around or past the work area; 2. Using fencing, barriers, barricades, temporary warning or control signs, or a combination of these to secure the area where moving plant is used; 3. Using spotters or safety observers to control traffic movement; 4. Using audible reversing alarms or other technologies or other safe work practices; 5. Implementing safe working distances.

Systems of Work Following the Incident

SafeWork NSW issued two Improvement Notices as a result of the incident which required Royal Demolition to develop a safe system for working with moving plant and have the excavator inspected by a competent person to ensure it was in a safe condition.
In response to the Improvement Notice which required Royal Demolition to develop and implement a safe system of work and provide documents evidencing such a system, such as a SWMS, training and site checklist, Royal Demolition provided a SWMS entitled "Amigos Pty Limited Civil Group" (Amigos SWMS). The Amigos SWMS only noted in relation to the risk of an excavator causing personal injury to others: "Check all persons are clear of work area before commencement".
The Improvement Notice to develop a safe system for working with moving plant was not complied with and a subsequent Improvement Notice and penalty for non-compliance with the first notice was issued.
The Improvement Notice for maintenance of the excavator resulted in Royal Lion selling the excavator and purchasing a new one.

Evidence for the defendant

No affidavits were filed on behalf of the defendant.

Consideration

I have had regard to the objects in s 3 of the 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 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 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 offender's level of culpability are based upon the following: 1. The risk of injury or death from being run over by an excavator in circumstances where there is no adequate training of a very young inexperienced worker, with no hi-vis clothing, and no reversing alarm or mirrors on the excavator, is highly foreseeable. 2. Being struck and crushed by moving plant equipment is a well-known and obvious risk in the demolition and construction industry. Relevant guidance materials specifically dealt with the risk. 3. The potential consequences of the risk were very serious injury or death. It is a minor miracle that Mr Alameddine was pressed into soft soil rather than crushed to death. 4. There were several steps that were readily available, which could have been implemented to eliminate or minimise the risk at the time of the incident, including: 1. the purchase of star pickets, barricades, bunting, barrier mesh or similar; 2. a requirement that all workers wear hi-vis clothing on site; 3. ensuring that plant has basic safety features such as mirrors, alarms and lights; 4. a work plan that complied with the Code of Practice; 5. ensuring nominated supervisors were on site at all times excavation or levelling took place; and 6. providing clear, verbal instruction to workers. 1. The above measures were not complex, expensive or burdensome. 2. The excavator was a 23-tonne piece of moving equipment. Mr Alameddine fortunately slipped on soil that was soft and yet to be compacted, which meant he was pressed into the ground. If this had not been the case, he would have been crushed to death. Nevertheless, Mr Alameddine suffered extremely serious injuries. 3. Mr Alameddine was a 16 year old boy at the time of the incident and he was completely inexperienced. He was an extremely vulnerable worker. 4. The maximum penalty for the offence is a fine of $1,500,000, which reflects the legislature's view of the seriousness of the offence.
I find that Royal Demolition's level of culpability is in the upper end of 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 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. Royal Demolition is still operating in business. Its operations involve the use of heavy machinery 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

Royal Demolition does not have any relevant prior convictions: s 21A(3)(e) Crimes (Sentencing Procedure) Act 1999 (NSW). However, Royal Demolition was only incorporated on 22 March 2017, so it had only been operating for two months at the time of the incident.
The court cannot find that Royal Demolition is otherwise of good character, that it is unlikely to re-offend or that it has good prospects of rehabilitation: s 21A(3)(f), (g) and (h) Crimes (Sentencing Procedure) Act 1999 (NSW). No evidence was called on these matters. No submission was made that these factors operated in favour of the defendant. When the defendant was issued with an Improvement Notice, it simply failed to comply. The eventual production of a document dealing with a safe system of work was a very desultory effort.
Nor can the court find that Royal Demolition has shown remorse for the offence: s 21A(3)(i) Crimes (Sentencing Procedure) Act 1999 (NSW). It has provided no evidence (apart from the bare fact of the guilty plea) that it has accepted responsibility for its actions or that it acknowledges that the injury to Mr Alameddine was caused by its actions.
Royal Demolition initially entered a plea of not guilty and there were a total of 13 mentions before the offender pleaded guilty on 17 August 2020 to the original Summons with no amendments to the facts or particulars: s 21A(3)(k) Crimes (Sentencing Procedure) Act 1999 (NSW). 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 (NSW). The prosecutor submitted that the appropriate discount is 15%. The written submissions for the defendant (MFI 2) also put forward the same percentage. In light of the procedural history, it is appropriate to give Royal Demolition a 15% discount on the penalty imposed for the guilty plea.

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."
There was no evidence and no submission about capacity to pay, so this issue does not arise.

Victim Impact Statement

Part 3 Division 2 of the Crimes (Sentencing Procedure) Act 1999 deals with Victim Impact Statements. The provisions apply to an offence being dealt with by the District Court where the offence results in the death of, or actual physical bodily harm to, any person - s 27(2)(a).
A Victim Impact Statement may be tendered to the court only by the prosecutor - s 30A(2). A court must accept a Victim Impact Statement tendered by a prosecutor if the statement complies with the requirements of the Division - s 30B. A victim to whom a Victim Impact Statement relates may read out the whole or part of their Victim Impact Statement - s 30D(1).
A court to which a Victim Impact Statement has been tendered must consider the statement at any time after it convicts but before it sentences, and may make any comment on the statement that the court considers appropriate - s 30E(1).
Mr Alameddine provided a Victim Impact Statement (PX 2). He left school after Year 9 and wanted to do demolition work. He had the aim of becoming an excavator operator. Mr Alameddine spent months at Royal North Shore Hospital. After that, he was confined to his home for a long time. Mr Alameddine said that he had a crushed hip area which needed an operation, a bad leg, a knee injury and an injured back. He still suffers from problems in these areas every day. He feels pain and cannot move around properly. He has had to give up playing football.
Mr Alameddine said that he was no longer fit and strong. He cannot do labouring work or demolition work. He will never be able to learn to drive an excavator. He has difficulty imagining what work he could do in the future. Mr Alameddine said that he has lost his teenage years and is worried about his future. Doctors have told him that he may have arthritis in the hip joint as he gets older.

Costs

There will be an order that the defendant is to pay the prosecutor's costs.

Comparable sentences

I did not obtain assistance from any of the sentence decisions referred to by both sides. That is not said as a criticism. I do not expect to ever hear another case where a worker is run over by an excavator but survives.

Training order

The prosecutor sought an order under s 241 of the Act that the defendant arrange for Mr El Masri to attend, within six months, a due diligence course conducted by a Registered Training Organisation, and provide written evidence to SafeWork NSW of the satisfactory completion of the course. The defendant consented to such an order. Mr El Masri was present in court and indicated that he personally consented to attend such a course.

Penalty

My orders are: 1. Royal Demolition & Excavation Pty Limited is convicted. 2. The appropriate fine is $240,000 but that will be reduced by 15% to reflect the plea of guilty. 3. Order Royal Demolition & Excavation Pty Limited to pay a fine of $204,000. 4. Order pursuant to Section 122(2) of the Fines Act 1996 that 50% of the fine is to be paid to the prosecutor. 5. Order Royal Demolition & Excavation Pty Limited to arrange for Mr El Masri to attend, within six months, a due diligence course conducted by a Registered Training Organisation, and provide written evidence to SafeWork NSW of the satisfactory completion of the course. 6. Order Royal Demolition & Excavation Pty Limited to pay the prosecutor's costs.

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: 09 October 2020

Work Health and Safety Regulation 2011(NSW)

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