SafeWork NSW v Simos Scaffolding Pty Ltd

District Court of NSW|2021-08-24

Solicitors: SafeWork NSW (Prosecutor) Sparke Helmore (Defendant) File Number(s): 2020/312633

The Risk

The risk is described in paragraph 11 of the Amended Summons is as follows: "11. The risk was the risk of persons, in particular Mr Al Shnen, suffering serious injury or death as a result of electric shock or electrocution while working on a scaffold that was in unsafe proximity to live overhead high voltage powerlines."

Reasonably Practicable Measures

Paragraph 12 of the Amended Summons pleads particulars of the defendant's failure to comply with the duty under s 19(1) of the Act as follows: "12. The defendant failed to ensure, so far as is reasonably practicable, that the health and safety of other persons, in particular Mr Al Shnen, was not put at risk from work carried out as part of the conduct of its business or undertaking, in that it failed to take one or more of the following measures, each of which is alleged to have been reasonably practicable, to eliminate, or alternatively minimise, if it was not reasonably practicable to eliminate, the risk: (a) Undertaking a risk assessment to determine the risk of a person or anything held by a person or attached to a person coming within unsafe distance of the powerlines, which: i. Assessed of the type of work activities being undertaken from the scaffolding and the proximity to the overhead powerlines; and ii. Determined the most effective controls to manage the risk; (b) Reading and complying with the requirements of the electrical supply authority, Endeavour, in its "Letter of Conditions" dated 18 June 2018, for the erection of scaffolding in proximity to powerlines; (c) Erecting a physical barrier on the scaffolding to prevent a person, or anything held by a person encroaching within an unsafe distance from the powerlines, such as plywood hoarding that fully covered the scaffold deck adjacent to the powerlines and was an impenetrable barrier to tools, materials and equipment; (d) Fixing warning signs to the safe side of the hoarding, warning of the presence of the electrical hazard on the other side; (e) In the event that CBD indicated that it would not pay for the defendant to install adequate safety measures to control the risks, such as the measures set out at paragraphs (a) - (d) above, refusing to undertake the scaffolding work."

Background

The parties presented an Agreed Statement of Facts and this material is summarised below.
At all material times Simos was a registered corporation which conducted a business or undertaking involving the provision of scaffolding services at construction sites.
Mr Ray Simpson was the sole director of Simos. Mr Simpson worked alongside and supervised the workers. Mr Simpson was primarily responsible for implementing safety measures for controlling hazards arising in the work undertaken by Simos.
Construct By Design Residential Pty Ltd ("CBD") was the principal contractor at a construction site located at 54-56 Mountford Avenue, Guilford, NSW ("the site"). CBD was building a multi-storey 15-unit assisted living apartment building at the site.
CBD engaged Mr Phil Keyes in the role of Estimator. Mr Keyes was responsible for preparing and delivering estimates for the cost of materials, labour and equipment needed to complete the construction project.
Between November 2017 and late April 2018 CBD engaged Mr Richard Bryson as the Site Manager. From around early June 2018 CBD engaged Mr Symond Georges as the Site Manager.
CBD engaged Simos to supply, erect and dismantle perimeter scaffolding at the site. CBD also engaged Lime Structural Solutions Pty Ltd ("Lime") to install pre-fabricated structural panels, including all fixing materials, bracing and props. Lime's scope of work included installing horizontal and vertical reinforcement for wall panels.
Mr Al-Shnen was employed by Lime as a labourer/installer to work at the site. Mr Al-Shnen arrived in Australia in 2012 as a refugee from Jordan.

The Power Lines Hazard

The site was situated on a corner block fronting Mountford Ave to the north and Marian St to the east. The street frontages contained both low and high voltage power lines. The high voltage power lines were 11kW. The electrical supply authority was Endeavour Energy ("Endeavour").
In April 2018 Mr Simpson attended the site and assessed the scope of the scaffolding works. Mr Simpson raised a concern with CBD about the proximity of uninsulated power lines to the scaffold. Mr Simpson told Mr Keyes that tiger tails and plywood casing would be required.
Mr Bryson had a meeting with Mr Simpson and a representative of Endeavour to discuss what was required to complete the scaffolding work in proximity to the power lines. Endeavour advised Mr Bryson and Mr Simpson that it was necessary to isolate the power lines and to erect the scaffolding with a plywood hoarding.
CBD asked Mr Simpson to use plywood hoarding that had been used for a previous job which Simos had undertaken for CBD.
On 23 April 2018 Mr Bryson ceased working for CBD. There was no Site Manager until Mr Georges commenced work in early June 2018.
On 29 April 2018 Simos commenced erecting the scaffolding at the site. The scaffolding was erected to approximately seven metres in height and consisted of 46 bays. Mr Simpson undertook the work with other workers from Simos.
On 1 May 2018 Mr Simpson signed a Scaffolding Handover Certificate certifying that the scaffolding complied with the relevant standards and was suitable for its intended use.
On 20 May 2018 Endeavour installed tiger tails on the low voltage power lines at the site.
In early June 2018 Mr Georges commenced working for CBD as the Site Manager.
In mid-June 2018 CBD arranged with Endeavour for the power lines to be isolated so further perimeter scaffolding could be erected to enable the construction works to continue.
The power line outage was scheduled for 6 July 2018 between 9.00am and 4.00pm.
On 18 June 2018 Endeavour sent a letter to CBD setting out the conditions for undertaking work in the vicinity of its power lines. The letter was titled "Erection of Scaffold in Proximity to Endeavour Energy Overhead Assets." The letter set out the following relevant requirements for erecting scaffolding near Endeavour's overhead network: 1. You must comply with the requirements contained within the WorkCover Code of Practice - Work Near Overhead Power Lines (WorkCover of NSW Publication No. 1394) ("the Code"). 2. You must complete a written risk assessment, have Safe Work Method Statements and engage safe systems of work in accordance with the Code. 3. The safe approach distance of 4000mm from all conductors in accordance with table 1 of the Code should be maintained at all times. 4. Erecting scaffolding within the safe approach distance of live overhead conductors is not permitted. Overhead Conductors will be isolated and made safe in accordance with Endeavour's safety rules. 5. Once erected, and with an impenetrable barrier (hoarding) as described in the Code affixed in place, the conductors may be re-energised, with safe approach distances reduced as shown in Table B and diagram 1.
The letter included: 1. A table setting out the maximum horizontal distances for low and high voltage power lines for the erection and dismantling of scaffolding (Table A - Clearances to Scaffolds - Erection and Dismantling). 2. A table setting out the maximum horizontal distances for low and high voltage power lines for scaffolding when erected (Table B - Clearance to Scaffolds when Erected). 3. A diagram setting out the minimum horizontal safety clearance distances between erected scaffolding and live power lines when a non-conductive hoarding was used to provide a barrier impenetrable to tools, materials and equipment (Diagram 1). The minimum horizontal clearance distance for high voltage power lines up to 33kV was 1.5m. The notes for the diagram specified: 1. that gaps between fitted sheets of approved plywood sheets should not exceed 3mm; 2. warning signs should be affixed to the safe side of the hoarding warning of the presence of the electrical hazard on the other side of the hoarding and warning that the hoarding should not be removed; 3. a competent person should visually inspect the hoarding and if applicable, the enclosure, on a daily basis to ensure that the hoarding and enclosure are in a satisfactory condition and remained impenetrable. 1. The letter enclosed a copy of the Code.
On 18 June 2018, Mr Keyes sent the letter to Mr Georges and Mr Simpson by email. In his email Mr Keyes said "Symond/Ray, please read and ensure you comply with the requirements".

The Further Scaffolding Works

On or around 5 July 2018, in advance of the power outage scheduled for 6 July 2018, Simos built additional levels on the scaffolding to within what Mr Simpson estimated was a safe distance from the power lines.
On 6 July 2018 Endeavour de-energised the power lines to enable Simos to erect the further scaffolding. Simos built up the scaffolding another level and fitted a plywood hoarding. The horizontal distance between the erected scaffold and the nearest high voltage power line was approximately 2.1 metres.
The hoarding erected by Simos did not comply with the Code and Endeavour's requirements. The hoarding measured 1.3 metres in height from the scaffolding deck. The hoarding was re-used from a previous job Simos had undertaken for CBD. Mr Simpson had purchased the plywood sheets for the hoarding from Bunnings for the previous job in July 2017.
The hoarding fitted by Simos at the site was not an impenetrable barrier to tools, material and equipment. The high voltage power lines were visible from the scaffold deck. There was a significant gap above the top of the hoarding, which can be seen in the photographs in PX 1. Warning signs were not affixed to the safe side of the hoarding warning of the presence of the electrical hazard.
At approximately 4.00pm on 6 July 2018 the power lines were re-energised.
On 6 July 2018, Mr Simpson signed a Scaffolding Handover Certificate certifying that the scaffolding complied with the relevant standards. He provided the Handover Certificate to CBD.
Between 7 July 2018 and 6 November 2018 Simos attended the site on several occasions to inspect and adjust the scaffolding. During this time Simos built an additional level on the scaffold. When the additional level was built, no steps were taken to notify Endeavour of the scaffolding work taking place in proximity to the power lines or to arrange for the power lines to be isolated.

The Incident

On 6 November 2018 there were several contractors undertaking work at the site including plasterers, bricklayers and carpenters.
At approximately 7.00am on 6 November 2018 Mr Al-Shnen arrived at the site to commence work. Mr Al-Shnen had not previously undertaken work at the site.
Mr Al-Shnen's role was to continue with the installation of the prefabricated wall panel system, in particular to install reinforced steel bars ("reo bars") through the wall panels. Once the reo bars were installed, concrete was to be poured into the wall panels to provide structural stability.
Mr Al-Shnen introduced himself to another worker Mr John Hidden, a carpenter engaged by CBD.
At approximately 8.00am Mr Al-Shnen asked Mr Georges to arrange some workers to move a steel frame so he could access reo bars underneath. Mr Georges instructed Mr Hidden and two other workers to assist Mr Al-Shnen in moving the steel frame.
The workers moved the steel frame and Mr Al-Shnen continued with the task of installing reo bars into the walls.
Immediately prior to the incident, Mr Al-Shnen was installing reo bars from the fourth level of the perimeter scaffolding fronting Marion St. Mr Al-Shnen was working on a level of the scaffolding where there was no adequate hoarding installed to protect him from the electrical hazard of the adjacent high voltage power lines.
Mr Al-Shnen was in the process of installing a reo bar horizontally into a wall cavity by standing on the scaffolding deck holding the reo bar, which was approximately 4.7 metres in length. The reo bar protruded over the plywood hoarding and made contact with the high voltage power lines. Mr Al-Shnen suffered a serious electrocution injury.
Mr Hidden was walking in the internal stairwell of the site when he noticed Mr Al-Shnen laying awkwardly on the scaffolding deck. Mr Hidden called Mr Georges for assistance. Mr Georges attended and smelt burning flesh and saw Mr Al-Shnen lying on the ground, shaking and frothing at the mouth with badly injured arms. Mr Georges called an ambulance. Mr Hidden directed an electrician to turn the site power off. Mr Al-Shnen was transported by ambulance to Westmead Hospital.

Injuries

The electrical current entered Mr Al-Shnen's hands and exited through his right shoulder and right hip. The electrical current caused open exit wounds to Mr Al-Shnen's right shoulder and hip which required multiple debridement and skin graft surgeries.
The extent of the injuries to Mr Al-Shnen's hands and forearms resulted in bilateral surgical amputation of both arms below the elbow. Mr Al-Shnen suffered significant burn injuries to a large part of his body. His injuries are described more fully in his Victim Impact Statement (PX 2) which is set out below.

SafeWork NSW Inspection

After the incident SafeWork NSW undertook an inspection of the site which identified: 1. A dark mark on the high voltage power line adjacent to the scaffold deck where Mr Al-Shnen had been standing when the reo bar made contact with the power line. 2. The reo bar was resting against a site security fence on the Marian Street side of the site and had visible signs of discolouration and body matter stuck to it.

Simos' Systems of Work

Prior to the incident Simos had engaged Employsure, who had provided it with a number of safety documents, including a Risk Register, Risk Assessment forms, Hazard Report forms, Toolbox Talk Report forms, a template Safe Work Method Statement ("SMWS") and a Site Safety Risk Assessment.
The Site Safety Risk Assessment specified that a risk factor to be considered was the risk of "workers coming into contact with overhead or underground services".
Simos had developed a SWMS for scaffolding erection, working at heights and working near traffic.
The SWMS identified the high-risk construction work activity of working near energised electrical installations or services. Mr Simpson was the person responsible for reviewing and ensuring compliance with the SWMS.
For the task of "constructing mobile and fixed scaffolding" a control measure listed was: "Where distribution lines or services are closer than 4m, seek advice and approval from the electrical infrastructure owner before proceeding".
The SWMS identified the task of working within four metres of overhead power lines and the hazard of electric shock and electrocution. The control measure for the task read: "Do not work within 4m of exposed, energised overhead electrical cables".
Simos had also developed Scaffolding Handover Certificates to issue to clients to verify that its scaffolding complied with all relevant standards and was suitable for its intended use. The Scaffolding Handover Certificates incorporated a space to provide details of containment sheeting that had been installed including the location, type, and method of fixing.

Legislation and Guidance Material

Clause 166(1) of the Work Health and Safety Regulation 2017 ("the Regulation") provides that a person conducting a business or undertaking ("PCBU") at a workplace must ensure, so far as is reasonably practicable, that no person, plant or thing at a workplace comes within an unsafe distance of overhead power lines.
Clause 166(2) provides that if it is not reasonably practicable to ensure the safe distance of a person, plant or thing from an overhead electric line, the PCBU at the workplace must ensure that: 1. a risk assessment is conducted in relation to the proposed work; and 2. control measures implemented are consistent with- 1. the risk assessment; and 2. if an electricity supply authority is responsible for the electric line, any requirements of the authority.
The requirements of the electricity supply authority, Endeavour, were provided to Mr Simpson on 18 June 2018.
Prior to the incident the Code was available on the SafeWork NSW website. The Code was provided by Endeavour and was part of its requirements for erecting scaffolding in proximity to its overhead network. The Code provides practical guidance to protect the safety of persons working near overhead power lines. The Code provides: 1. If it is not possible to eliminate the risk of working near overhead power lines, the risk may be minimised by separating the hazard from workers, for example by erecting physical barriers to prevent a person or anything held by a person coming near the overhead power line (page 17). 2. Information on identifying and assessing the relevant approach distances for power lines. 3. General risk management principles for work undertaken near overhead power lines. 4. The requirements for using a hoarding as a non-conductive impenetrable barrier for persons, tools, materials and equipment (page 43).
Australian Standard AS/NZS 4576:1995 Guidelines for Scaffolding was also published and available to Simos. The Standard relevantly provided: 1. Power lines are a potential hazard to persons erecting, working from or in the vicinity of a scaffold. Isolate or shield any electrical wires (clause 5.4.1). 2. The clearance between scaffolds and any transmission line should be not less than four metres where any metal member is used. 3. Do not erect scaffolding until the necessary measures have been taken to minimise risk and a written authorisation has been received from the electricity supply authority. 4. High voltage mains (i.e. more than 600V) near scaffolding should be de-energised, short-circuited and earthed or re-routed prior to erection of the scaffolding (clause 5.4.2).
Safe Work Australia had also published guidance material available to Simos including the Safe Work Australia General Guide for Working in the Vicinity of Overhead and Underground Electrical Lines, July 2014. The General Guide provided: 1. Working in the vicinity of energised electric lines can create risks to workers and the public where a person or something the person is holding is in contact with or could come closer than the relevant approach distances. 2. If it is not reasonably practicable to completely eliminate the risk then consider isolating the hazard from people e.g. erect a physical barrier to prevent any part of the plant or equipment or a person or anything held by a person, or attached to a person, entering safe approach distances. A physical barrier should be made of non-conductive material like wood or plastic and be erected safely. This may require isolating the electricity supply while the barrier is installed.
Safe Work Australia had also published an Information Sheet on Scaffolding Work near Overhead Electric Lines, July 2014 which provided information on using hoarding and enclosures for scaffolding with reduced safety clearances.
Simos did not comply with the available guidance material and the requirements of Endeavour because it did not undertake a risk assessment to determine the risk of a person or anything held by a person coming within an unsafe distance of the power lines. A risk assessment was required to be undertaken pursuant to cl 166(2)(a) of the Regulation. The letter from Endeavour also specified the requirement to undertake a written risk assessment and to implement safe systems of work.
Simos did not erect hoarding that was an impenetrable barrier to prevent persons, or anything attached to or held by a person, from coming within an unsafe distance of the power lines. The hoarding was used from a previous construction site managed by CBD and did not provide adequate protection against the risk.
Simos did not fix warning signs to the safe side of the hoarding warning of the presence of the electrical hazard.
The failure by Simos to take adequate steps to ensure the safety of the scaffolding in proximity to the power lines placed persons working from the scaffolding at risk of serious injury or death.

Steps taken by Simos after the Incident

After the incident Simos undertook a risk assessment of the hazard of the high voltage power lines in consultation with CBD, using the Risk Assessment Form provided by Employsure. The risk assessment identified the inadequacy of the hoarding and the need to provide an impenetrable barrier and to fix signs to warn workers of the hazard of the power lines. Mr Simpson signed the Risk Assessment Form on behalf of Simos.
On 9 November 2018 Mr Simpson and CBD arranged for additional hoarding and mesh to be installed on the scaffolding which fully covered the scaffold deck and was an impenetrable barrier.
Warning signs were affixed to the safe side of the hoarding warning of the presence of the electrical hazard on the other side.
On 9 November 2018 Simos issued a Scaffolding Handover Certificate confirming the installation of additional hoarding and certifying that the scaffolding complied with all relevant standards and was safe to use.

Affidavit of Raymond John Brian Simpson

Mr Simpson, the sole director of Simos, affirmed three affidavits dated 2 August 2021 (DX 1), 10 August 2021 (DX 2) and 20 August 2021 (DX 3).

Background to the Business

Simos is a small local business which Mr Simpson started in 2011 after having worked in the scaffolding industry for a number of years. The majority of the work that Simos undertakes is for small to medium-sized residential construction projects in the Greater Sydney region and along the mid-north coast of New South Wales.
Simos currently employees eight people, being Mr Simpson himself, an Operations Manager, four scaffolders and two office workers.

Acknowledgment

Mr Simpson stated: "I acknowledge that the impact this incident has had on Mr Ghanim Al-Shnen is immeasurable and that the seriousness of this incident must be taken into account in sentencing".

Financial Position

The rest of the content in Mr Simpson's affidavits are dealt with below in relation to the defendant's capacity to pay a fine. Mr Simpson said that a significant fine would be crushing as the most valuable asset that the business owns is the scaffolding worth $200,000 and the vehicles that workers use every day for work. He also explained that he is the sole income earner in his family and he would not be able to provide for his family unless Simos kept operating. He explained that a fine would also result in lost jobs for his employees, who will find it extremely difficult to find employment in the current climate.

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 defendant's level of culpability are based upon the following: 1. The risk of suffering serious injury or death as a result of electric shock or electrocution while working on a scaffold that was in unsafe proximity to live overhead high voltage power lines was known to Simos and was clearly foreseeable. The relevant guidance material provided clear illustrations of how the risk of working near overhead power lines could be minimised, including by erecting physical barriers to prevent a person or anything held by a person coming near the overhead power lines. 2. The likelihood of the risk occurring was relatively high in the circumstances where Simos: 1. failed to undertake a risk assessment to determine the risk of a person or anything held by a person coming within an unsafe distance of the power lines; 2. did not erect hoarding that was an impenetrable barrier to prevent persons, or anything attached or held by a person, from coming within an unsafe distance of the power lines; and 3. did not arrange for appropriate warning signs. 1. The potential consequences of the risk were serious injury or death. 2. The available guidance material set out appropriate control measures. 3. There would have not have been a significant burden or cost in taking such measures to ensure safety. Following the incident Simos: 1. promptly undertook an appropriate risk assessment; 2. arranged for additional hoarding and mesh to be installed; and 3. issued a Scaffolding Handover Certificate confirming the installation of additional hoarding and certifying that the scaffolding complied with all relevant standards. 1. Mr Al-Shnen suffered extremely serious, life-altering injuries. The bilateral amputation of both arms below the elbow and the extensive burns to his body were the direct result of the incident. 2. 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. 3. Simos did have a documented safety system, but it was not observed on this occasion. A glaringly obvious risk was not even perceived. 4. Simos did not engage in conduct which deliberately flouted safety rules.
Counsel for the prosecutor submitted that the objective seriousness of the offence was in the high range. Counsel for the defendant submitted that it was high but not at the highest. I accept both submissions.
I find that the level of culpability of Simos Scaffolding Pty Ltd is in the high 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. Simos Scaffolding Pty Ltd is still conducting a high risk business. Its operations involve the provision of scaffolding services and the continuing engagement of workers in a high risk industry.

Aggravating Factors

The injury, emotional harm, loss or damage caused by the offence was substantial: s 21A(2)(g) Crimes (Sentencing Procedure) Act 1999. Mr Al- Shnen's life suffered catastrophic injuries at a young age. His terrible ordeal is described fully in the Victim Impact Statement which is referred to below.

Mitigating Factors

Simos Scaffolding Pty Ltd does not have a prior record of convictions: s 21A(3)(e) Crimes (Sentencing Procedure) Act 1999.
Simos Scaffolding Pty Ltd is otherwise of good character: s 21A(3)(f) Crimes (Sentencing Procedure) Act 1999. The steps which it took after the incident demonstrate this. Simos Scaffolding Pty Ltd has been in business for 10 years.
Simos Scaffolding Pty Ltd is unlikely to re-offend: s 21A(3)(g) Crimes (Sentencing Procedure) Act 1999.
Simos Scaffolding Pty Ltd 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.
Simos Scaffolding Pty Ltd 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 injury to Mr Al-Shnen was caused by its actions.
Simos Scaffolding Pty Ltd 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 a 25% discount for an early plea.
Simos Scaffolding Pty Ltd gave assistance to law enforcement authorities: s 21A(3)(m) Crimes (Sentencing Procedure) Act 1999. It co-operated 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."

Affidavit of Carl William Baker

Mr Baker, a chartered accountant and the current the Director of Haddad Baker Pty Ltd, an Accounting and Business Advisory Firm specialising in Taxation and Superannuation, swore an affidavit on 2 August 2021 (DX 4).
Mr Simpson first approached Mr Baker in January 2020 to assist with managing the accounts for his business and to provide ongoing advice and planning strategies in relation to cash flow forecasting and budgeting. Following consideration of the business structure and finances of Simos, Mr Baker recommended that Mr Simpson use Simos Scaffolding Pty Ltd as the primary trading entity, and set up a trust for the purpose of being able to provide a level of asset protection so that if anything were to happen to the trading entity, the assets would not be lost.
In early 2020 the Simpson Family Trust was established in accordance with Mr Baker's recommendations. Mr Baker explained that The Simpson Family Trust purchased the scaffolding (valued at approximately $200,000) from Simos and leases the scaffolding to Simos.
Mr Baker was not notified of the proceedings until November 2020 when he received notification from the NSW Department of Customer Service.
Mr Baker stated that in his professional opinion a significant fine would cripple Mr Simpson's business and he would be required to wind up Simos in order to pay the fine. He formed this opinion on the basis that: 1. The business does not make a significant profit. 2. The business (including Simos Scaffolding and the Simpson Family Trust) has some assets including a number of vehicles and scaffolding, however these are essential to the operation of the business. 3. The business currently has a number of loans it is paying off each month.
Mr Baker explained that on 16 July 2021 he provided Simos' financial records to the National Australia Bank ("NAB") to ascertain its capacity to borrow money to pay any fine that may be imposed on the business. On 21 July 2021, the bank advised by email that based on the financial information and figures, NAB would not be able to assist with any new lending to Simos.

Financial Information provided by Mr Simpson

In his affidavit dated 2 August 2021 (DX 1), Mr Simpson stated that Simos has an average annual revenue over the past five years of $786,588.60. He provided the following information: 1. In 2015/2016 financial year, Simos received $579,856 in income (excluding GST), and spent $522,254 on expenses, making a profit of $57,602. 2. In 2016/2017 financial year, Simos Scaffolding received $744,557 in income and spent $710,490 on expenses, making a profit of $34,067. 3. In 2017/2018 financial year, Simos Scaffolding received $875,265 in income and spent $787,916 on expenses, making a profit of $87,349. 4. In 2018/2019 financial year, Simos Scaffolding received $799,064 in income and spent $808,433 on expenses, making a loss of $9,369. 5. In 2019/2020 financial year, Simos Scaffolding received $934,201 in income and spent $855,198 on expenses, making a profit of $79,003. 6. Simos Scaffolding has not completed its tax return for the 2020/2021 financial year. Between July to September 2020, Simos Scaffolding received $235,519 in income (excluding GST) and spent $46,319 on salary, wages and other expenses. 7. Between October to December 2020, Simos Scaffolding received $170,320 (excluding GST) in income and spent $39,800 on salary, wages and other expenses. 8. Between January and March 2021, Simos Scaffolding received $114,908 in income (excluding GST) and spent $42,593 on salary, wages and other expenses. 9. Between April and June 2021, Simos Scaffolding received $237,529 in income (excluding GST) and spent $42,471 in salary, wages and other expenses. 10. Simos Scaffolding has a number of loans currently with National Australia Bank Limited. 11. The most valuable asset (both in terms of monetary value and value to the business) is scaffolding which has a market value of approximately $200,000. The scaffolding is owned by the Simpson Family Trust, a related entity, which leases the scaffolding to Simos Scaffolding. 12. Simos owns a Forklift Baoli 1.8T (2014) which is used to transport scaffolding and other materials. It has a market value of approximately $10,000. Simos currently has $4,821 outstanding on the loan to NAB for the forklift. 13. Simos also owns a tractor (1950) worth $2,500 and a ride-on mower worth $5,000. 14. Simos has a number of vehicles for work purposes including: 1. Holden Colorado (2012) worth approximately $8,000; 2. Holden Colorado (2017) worth approximately $40,000; 3. Toyota Hilux (2008) worth approximately $5,000; 4. Isuzu NPR (2014) worth approximately $10,000; 5. Husqvarna FE350 (2018) worth approximately $8,000. The purchase price was $17,634 and Simos Scaffolding currently has $8,657 outstanding on the loan. 6. In October 2020, Simos Scaffolding purchased an Isuzu FVY 240-300 Truck (2020). Simos scaffolding obtained a loan from NAB for $186,000 to finance the vehicle and currently owes approximately $172,000 on the vehicle. 1. There is $4,790.19 owing to the bank on the company credit card.
Mr Simpson also said that COVID-19 has had a significant impact on Simos and its employees. In 2020, Simos received $9,000 in JobKeeper support from the Federal Government to allowed Simos Scaffolding to continue paying its employees when they were not able to work.
Mr Simpson also provided the following figures detailing the gross salary he received as director of the business in recent financial years: FY 2015/2016 - $110,243; FY 2016/2017- $116,833; FY 2017/2018 - $122,951; FY 2018/2019 - $119,843; FY 2019/2020 - $124,090; FY 2020/2021 - $73,498.
Mr Simpson explained that he and his partner Ms Jamielee Ega purchased land located in Bonnells Bay NSW for $235,000. The current market value of the property is estimated to be approximately $700,000. There is $445,000 owed for two consolidated mortgages and a construction loan.
The couple also purchased a residence in October 2020 at Morisset NSW for $900,000. A family member lent $45,000 for the deposit on the property. The couple make weekly repayments of $100 and allow a family member to rent the property at a reduced rate of $450 per week. The couple also took out a large mortgage and currently owe $884,000 on the loan. The Bonnells Bay property served as equity for the purchase of the Morisset property.
The couple also own a Kia Sorento (2014), purchased for $25,000 in May 2021 and a Coramel Caravan (2012) with a value of $7,000. Ms Egan owns a Holden Barina (2012) which has a current market value of approximately $3,000. In his affidavit, Mr Simpson explained that this car is used as "a run around car" for Simos.
Ms Egan also currently owes $10,000 to the Australian Taxation Office.
Mr Simpson's affidavit dated 20 August 2021 (DX 3) concerned capacity to pay. The affidavit was provided in response to a request from SafeWork NSW for further financial information. Simos provided all of the material sought by SafeWork NSW in a letter dated 6 August 2021. This material concerned: 1. Financial statements of Simos for 2017/2018, 2018/2019 and 2019/2020. 2. Copies of the loan documents for the forklift Baoli 1.8T. 3. Copies of the loan documents for the Husqvana FA350. 4. Copies of the loan documents for the Isuzu NPR. 5. A copy of the amortization schedule for the Holden Colorado (2017). 6. A copy of the Simpson Family Trust Deed.
The balance of the affidavit corrected some minor errors in the previous affidavits dated 2 August 2021 (DX 1) and 10 August 2021 (DX 2).
In previous judgments this court has pointed out that where a defendant bears the onus of proving a reduced capacity to pay, it is not enough to tender a cherry-picked selection of documents, which often raise more questions than they answer. A defendant has an obligation to put on all financial material and deal frankly with SafeWork NSW in supplying additional financial material if requested. Simos and Mr Simpson have done so. As counsel for the defendant accurately put the matter, the defendant has "put all of its cards on the table". The court has all of the necessary financial information regarding the defendant, and additional information regarding the financial position of Mr Simpson and his partner.
Mr Simpson was not cross-examined on his affidavits. Counsel for the prosecutor very fairly conceded that there was an evidentiary basis to find a reduced capacity to pay. However, counsel submitted that any fine should not be moderated, because of the high degree of objective seriousness and the necessity for general deterrence.
Counsel for the defendant submitted that the defendant operated a small business. I accept that submission. Counsel for the defendant submitted that the defendant had established evidence to show that it had a limited capacity to pay. I accept that submission. Counsel for the defendant submitted that a significant fine is likely to have "a crippling effect" on the defendant's operation. I accept that submission.
My findings and conclusions on capacity to pay are set out below under the heading "Penalty".

Victim Impact Statement

The defendant was convicted at the sentence hearing on 24 August 2021.
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).
In his Victim Impact Statement (PX 2) Mr Al-Shnen said: "I was injured at work on 6th November 2018 on a building site in my role as a labourer. The electrical injury caused massive injuries to my waist, my right shoulder and both arms and hands. I was taken by ambulance to Westmead Hospital and, from there, I was admitted to the Burns Unit at Concord Hospital. The surgeons who treated me decided that the amputations of both upper limbs were needed. My left hand was amputated between the wrist and elbow. My right arm was amputated above the elbow. I also incurred major burns through my skin around large areas of my torso. I needed to have multiple operations - like the amputations I mentioned above procedures, skin grafts, where they peel skin off my thighs to place on the areas that were burnt so badly there was no skin left. I also needed areas 'debrided'. This is where the nurses and doctors scrub down areas of skin that are dying and need to be cleared away to see if new skin can grow back. I later had a series of other operations to refashion the stumps of my arms, to insert rods ready for the prostheses and then application of the prosthetic limbs. I summarise here the main ways these injuries have impacted me, in various areas of my life. Physical: A. Time cost. I have lost countless hours of my life to inpatient admissions, prosthetics, physical therapy, surgical appointments, psychology appointments and other allied health appointments. B. Pain. In addition to the early painful surgeries, I still have pain every day in my stumps, my shoulder and my torso. The more I try to do with my prosthesis, the more pain I will have in the evening and throughout the night which causes me difficulty sleeping. I have to sleep in one position on my back only and put two pillows on each side under each arm to stop me from turning on my sides. Doctors have told me this will be something I have to adjust to for the rest of my life. I only use the prostheses three to four hours at a time until it starts to become too painful. I have constant significant pain in my right arm which the doctors are currently investigating. C. Reduced physical function: Even with the assistance of the prosthesis, this injury has permanently impacted on my ability to undertake everyday tasks. I have been given good prosthetic limbs by a surgical team, but I am still unable to do most tasks that require dexterity and coordination. I need full time assistance from carers to assist me every day with tasks such as travel, accessing technology (e.g. getting my phone for me and placing it in my prosthetic hand), personal hygiene, some eating tasks and some dressing. I try to do what I can but there are still many domestic chores that I cannot master with a prosthetic limb. I will require this level of care for the foreseeable future and will require an extensive level of care for the rest of my life. I require assistance putting the prosthetics on and affixing it to both arms. I am unable to expose it any water such washing my face or showering, I require assistance dressing and undressing. When eating, someone will need to place the spoon near my prosthetic arm in the correct position to enable me to use it. The weight of the prosthetic arms is approximately 3kgs each arm, which impacts on my ability to wear them for long periods. When I go for a walk, I need to take them off as they weigh me down and cause me pain I am unable to undertake something as simple as brushing my hair without the need for assistance from the carers. Another indignity is having to rely on the assistance from the carers when relieving myself. At times when my carers are between shifts and are unavailable and I urgently need to go to the bathroom, I am unable to so until the carer arrives. At times I have had to call neighbours to assist me in this regard when my carer's are not present. Social and Religious: My injuries have prevented me from praying and attending to my usual weekly religious practices, which are important to me. I have fewer friends now but I cherish the ones who have stood by me. I rely on social media for contacts, which is not the same as being able to go to work, or shop or visit independently. The worst social impact has been the way that others look at me. Many people stare and make me feel very self-conscious. But I am most badly affected when I see children who look scared or disgusted by my appearance. This makes me extremely sad and I have lost my dignity and confidence as a man. Vocational: My physiotherapists and surgeons have agreed that I cannot work. The main reason is that I have lost my manual capabilities. My pain also limits my capacity to work. Furthermore, I spend much of my time doing prescribed rehabilitation exercises on my own (e.g. practicing using the myoelectric arm or re-strengthening muscles) or attending actual therapy appointments. I also have medical appointments. All these issues together prevent me from retraining. Family: Perhaps the deepest pain for me has been my prolonged separation from my wife and children. A combination of factors, including my need for highly specialised medical and allied health treatments required me to stay in Sydney, while my family migrated from Iraq to Finland. I cannot go there and complete my treatment and they are not permitted to come to Australia. Emotional and Mental Health: A. Trauma-related stress. I have been experiencing unwanted, painful memories of the day of the accident. These 'flashbacks' extend to the days in hospital, such as when the doctor said that they have to amputate both arms. That still makes me shudder. For a long time, I also had terrible nightmares of injuries and confusing terrifying scenes in hospitals. I still feel distressed when reminded of the accident and surgeries. B. Moral injury. I have felt abandoned and let down by the employer and those I held accountable for my injury because there was no effort to ask about my wellbeing or progress. To my shock and amazement, nobody ever came to the hospital or my home and I did not receive a phone call to see if I was alive or okay or needed anything. To think that they were still at work, making money, while I was in hospital, in pain, with my life changed, made me feel sad and betrayed. C. Loss of autonomy and self-reliance. It is hard to express what it is like living your life when you need to rely on others to do basic things for you - I must accept how they do these things for me, and how long I have to wait for them and so on. It is not just frustrating - it leads to a loss of dignity when you cannot do basic things for yourself like finish getting dressed, finish your own hygiene or take your mobile phone from your own pocket. I cannot even hug my own children and express my affection for them which has left me distraught. D. Loss of self-worth. I realise that working for money, doing small jobs at home and helping others all helped me to feel like a good person. My feelings of worth and value have been more than halved since my injuries. I am proud of how hard I have worked in my therapy and I have talked to my psychologist about this but still I feel useless everyday compared to how I was. E. Uncertainty over future. One of the worst things for me is that I can't see things changing. I wish to earn money for myself and my family; I long to be united with them; I wish to have some predictability about how and where I will live; I need to know that my family will be provided for if I cannot be the breadwinner for my own children. Now knowing these things causes me great worry every day. I feel inadequate as a husband and as a father. F. Depression. The combined effect of all these things has led to Depression, for which I am receiving some treatment. My mind tells me that it would have been better if I died in the electrical accident and I pray to die but I will never kill myself. As I have said, I feel that my worth is reduced, it is hard to be optimistic about the future, I have lost confidence, I don't like going out. I have become socially withdrawn, as whenever I am in public or attend gatherings, people would stare and point as if I am not human. It also invited questions about my injury which I was not comfortable answering. When I do go out, I always end up on my own, with the trauma of what happened to me, with the chronic pain, no limbs and no family by my side. I feel sad all the time. I don't know how my life will be now."
I will take the Victim Impact Statement into account in arriving at an appropriate sentence.

Costs

The parties agreed to an order that the defendant is to pay the prosecutor's costs in the amount of $40,000.

Penalty

This is a very difficult case in which to determine an appropriate sentence. I find as follows: 1. The defendant has disclosed all necessary financial information to the court. 2. The defendant has a reduced capacity to pay. 3. The defendant is a relatively small business. 4. A large fine will probably cripple the operation of the defendant's business. 5. The defendant has a business which is a going concern and which employs seven people besides Mr Simpson. 6. Mr Simpson is the breadwinner for a family of six. 7. Mr Simpson is a decent hard working man who has unfortunately made a terrible mistake.
I do propose to moderate the fine which I would otherwise impose because of these factors. Before setting out my final decision, I wish to indicate the appropriate fine in this case, had there been no issue about capacity to pay. In doing so I am guided by the recent decision of the Court of Criminal Appeal in Attorney-General v Jamestrong Packaging Australia Pty Ltd [2020] NSW CCA 319.
The case involved a prosecution under the Act and a death on a construction site. The objective seriousness of the offence was said to be in the high range. The defendant had several mitigating factors in its favour. The appeal was against the inadequacy of sentence. The Court of Criminal Appeal said at [19]: "The dominant factor in determining an appropriate level of penalty is the very high order of negligence that made this infringement such an objectively serious offence of its kind. … A starting point of $400,000 would be appropriate, discounted by 25% to $300,000."
Thus the "starting point" in a case which is in the high range of objective seriousness, where there was a death and where the defendant had mitigating factors in its favour, is a fine of $400,000. Mr Al-Shnen did not die in the incident, but his injuries were of the kind that one might see in a war zone. He is a young man who is going to have to face the rest of his life with severe disabilities and the need for care and assistance. If there had been no issue about capacity to pay, I would have imposed a fine of $400,000, reduced by 25% to reflect the early plea of guilty to $300,000.
My orders are: 1. Simos Scaffolding Pty Ltd was convicted on 24 August 2021. 2. The appropriate fine is $200,000 but that will be reduced by 25% to reflect the early plea of guilty. 3. Order Simos Scaffolding Pty Ltd to pay a fine of $150,000. 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 Simos Scaffolding Pty Ltd to pay the prosecutor's costs agreed in the amount of $40,000.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 August 2021

Work Health and Safety Regulation 2017(NSW)

At a glance

Court

Decision date

Catchwords

Source

Catchwords

Judgment (29 paragraphs)

Parties

Legislation Cited (4)

Cases Cited (18)

Cited By (1)