WorkCover Authority of New South Wales (Inspector Buggy) v P&O Ports Ltd

JUDGMENT:

• 17 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: Schmidt J

MATTER NUMBER IRC 4524 OF 1999 WORKCOVER AUTHORITY OF NEW SOUTH WALES (INSPECTOR BUGGY) V P&O PORTS LTD (FORMERLY KNOWN AS CONAUST LTD T/AS P&O PORTS) Prosecution under s16(1) of the Occupational Health & Safety Act 1983 JUDGMENT 1 This is a prosecution brought under s16 of the Occupational Health and Safety Act 1983 ('the Act'). The defendant pleaded guilty to the following charge: 'The defendant, being an employer, on the 3 October 1996 at 1 Throsby Wharf, Newcastle, in the State of New South Wales, DID FAIL to ensure that persons not in its employment and in particular, Robert Giles, were not exposed to risks to their health or safety arising from the conduct of its undertaking while they were at its place of work, whilst forklift trucks transported shipping containers, contrary to Section 16(1) of the Occupational Health & Safety Act , 1983 in such case made and provided. The Particulars of the charge are: (a) The defendant failed to put in place measures necessary to ensure that restricted access existed to the area in where forklifts were operating to move and load containers at the said wharf site.

(b) As a result of the said failures, Robert Giles suffered fatal crush injuries.'

2 The agreed statement of facts provided: '1. At all material times the Prosecutor was an Inspector duly appointed and empowered by Section 48 of the of the Occupational Health and Safety Act 1983 to institute proceedings in the within matter.

At all material times NEWCASTLE PORTS CORPORATION , a statutory body pursuant to the Ports Corporation and Waterways Management Act, 1995, whose principal office was at Cnr of Scott and Newcomen Streets, Newcastle, in the State of New South Wales, had control of No 1 Throsby Wharf, Newcastle.

P&O PORTS LTD (FORMERLY KNOWN AS CONAUST LTD T/AS P&O PORTS) [ACN: 000 049 301] , the defendant, was duly incorporated with its registered office at Level 7, 160 Sussex Street, Sydney in the State of New South Wales, was the occupier of premises known as No 1 Throsby Wharf, Newcastle.

On 3 October 1996 at about 11:15am, Robert Giles, a 42 year truck driver, sustained injuries resulting in his later death when he was crushed between two shipping containers at the said premises at No 1 Throsby Wharf, Newcastle. The area where the accident occurred was known as the Wharf Storage Area. This area formed part of the premises leased by the defendant from Newcastle Ports Corporation.

At the time of the accident, work was being carried out by forklifts. The said work consisted of transporting empty half-height shipping containers (known as bolsters) from one location where they had been previously stacked to the said area.

The forklift involved in the incident to Robert Giles was being driven by an employee of the defendant, Scott Watkins, who was operating a Hyster type 32 tonne forklift truck. At the time of the accident, Watkins had transported three bolsters and had placed them at the said area where the accident occurred. Two bolsters were positioned on top of each other and one single bolster was sitting alongside.

Watkins was in the process of transporting another load of two bolsters into position on top of each other. The positioning was carried out by bumping the bolsters previously placed. The action of bumping caused the single bolster to move toward the stack of the two previously positioned bolsters. Unknown to Watkins, Giles had been in a position between the original three bolsters and became crushed when the load was bumped. Following the accident, Giles was released with the aid of the same forklift truck by pushing away the corner of the bolster trapping him. He was transported to hospital and underwent treatment but died from injuries sustained on 5 October 1996.

Robert Giles was an employee of Patreru Pty Ltd. This company had been engaged by Strang International Pty Ltd on the day of the accident for the transportation of empty bolsters from the Wharf Storage Area to the Newcastle depot to Tomago, operated by Strang. The work was scheduled to commence at approximately 9:00am on the said day and was to be carried out by the deceased worker together with a truck driver employed by Strang, known as Keith Marler. Two road transport semi-articulated trucks were being used for the work. They had been driven to the premises and parked at the intended work location within the Wharf Storage Area by Giles and Marler respectively. Loading work had not commenced at the time of the accident. The accident occurred at approximately 11:15am.

During the period of time elapsing after the arrival of Marler and Giles at the premises and the time of the accident, both Giles and Marler were free to access any area within the premises. Other visitors to the area were also free to move around the said premises.

Investigation by Inspector Buggy revealed that at the time the forklift truck was being operated by Watkins. The area in which the forklift was travelling was not cordoned off or identified in any way. The manner in which the forklift was being operated meant that vision of the operator was limited when the forklift travelled in the forward direction.

The system in place at the time of the incident was such that there were limited restrictions as to entry to the premises and in particular to the area where the bolsters were being moved and stored. Factual inspection by Inspector Buggy revealed that no markings were provided to designate truck parking areas or pedestrian walkways within the wharf storage area. The traffic flow of vehicles was not defined or controlled within the confines of the site by either Newcastle Port Corporation, or P&O Ports Ltd (Formerly Known as Conaust Ltd t/as P&O Ports).

According to Keith Marler, on the day of the accident there had been a hold-up to the work because the keys to the forklift had been lost. Further, the containers had to be inspected by the Quarantine Inspectors before being loaded onto the trucks driven by Marler and by Giles. Just prior to the accident, Giles was some 15 to 20 metres distant from Marler. Giles was looking for twist locks which are used to lock containers on top of one another during transportation. Giles had climbed into the single half-height container and threw out two single twist locks on to the ground. He then commenced to climb out of the container with this back towards the road. The forklift approached from this direction. The operator bumped the containers together to position them and this caused the container in front of Giles to move towards him, pinning him against it and the pair of containers on the workshop side. When Marler saw the forklift approaching the area, he called out to Giles but believes he did not hear him. It appeared to Marler that Giles did not hear or see the forklift approaching.

Watkins, who was operating the forklift on the said day, had undertaken this type of work for the past three years. Watkins did not take any steps to ensure that no person entered the area in which the forklift was travelling and where containers were being stacked.

Factual reports were prepared by Inspector Darren Lane dated 12 December 1996 and Inspector Neil Buggy 16 January 1997 together with photographs.

The contractual agreement between Newcastle Port Corporation and the defendant was a verbal agreement made as the need for port facilities arose. No formal lease or contractual agreement was in place between the defendant and Newcastle Ports Corporation. Access to the said area was obtainable via two separate locations at the south-east and south-west area of the said site. Newcastle Ports Corporation was aware that there were no formal requirements upon entry at the site and no instructions were provided regarding restricted locations or other procedures regarding work in progress at the site.

Vehicle traffic flow was not defined or controlled at the site. Pedestrian walkways or areas safely accessible on foot were not provided or marked within the Wharf Storage Area. Truck parking areas were not marked or defined in any manner.

It is alleged NEWCASTLE PORT CORPORATION , was aware of the risk to the health and safety of persons at work whilst using the said premises as a place of work for the following reasons: I. A warning letter had been received by Newcastle Port Corporation from the then known entity Maritime Services Board (MSB) Hunter Ports Authority dated 5 April 1994 as a result of an incident which occurred at No 1 Thorosby (sic) Wharf, Newcastle, on 12 December 1993.

II. A positional paper outlining the responsibility of both wharf users and the Newcastle Port Corporation was presented by the Newcastle Port Corporation at a meeting of the Newcastle Ports Security Committee on 16 March 1994. In particular the said positional paper outlined the risk to persons identified by the layout of the wharf areas and the manner by which access to them could be obtained. The paper also noted the need to ensure a safe system of work regarding entry and exit of goods by road and rail transport and that communication between the Newcastle Port Corporation defendant and Stevedoring Companies was necessary to ensure safety.

III. On 29 August 1996, Improvement Notice No 153655 was issued by WorkCover to Newcastle Port Corporation regarding a complaint as to the issue of unauthorised access to wharf areas within the area.

IV. As at the time of the accident, Newcastle Port Corporation had taken no steps or inadequate steps to ensure that traffic flow, pedestrian access, layout of wharf areas and access by non-authorised persons was controlled so as to ensure the safety of persons not in their employ who were at work at the said premises. 18. A coronial inquest into the death of Robert Giles was held on 29 October 1997 at the Newcastle Coroner's Court.

19. It is alleged that the defendant P&O PORTS LTD (Formerly Known as Conaust Ltd t/as P&O Ports) [ACN: 000 049 301] has breached section 16(1) of the Occupational Health and Safety Act on 3 October 1996 at the wharf storage area of 1 Throsby Wharf at Newcastle in the State of New South Wales being an employer did fail to ensure that persons not in its employment were not exposed to risks to their health or safety arising from the conduct of its undertaking whilst they were at its place of work, whilst forklift trucks transported shipping containers, in that, a) The defendant failed to put in place measures necessary to ensure that restricted access existed to the area in where forklifts were operating to move and load containers at the said wharf site.

b) As a result of the said failures, Robert Giles suffered fatal crush injuries.

3 At the hearing the defendant advanced its plea in relation to the charge, but the parties asked the Court not to determine the matter until the Court of Criminal Appeal had given its judgment in R v Thomson; R v Houlton [2000] NSWCCA 309. The parties later filed written submissions as to the principles established in that judgment, their application by this Court in various judgments and how that approach should be applied to the circumstances of this case. 4 This was the first prosecution of the defendant under the Act. The events in question occurred at a common user wharf utilised by the defendant and others, known as Throsby wharf. The wharf was operated by Newcastle Ports Corporation ('the Corporation'), which leased the wharf on a single shift basis to users including the defendant. 5 Mr Hodgkinson of counsel, appearing for the defendant, drew attention to a number of factual matters. 6 On the day of the accident the defendant had obtained use of a part of the wharf. Other users had also obtained access to the wharf on that day. The Corporation retained control of the wharf, including the safety infrastructure in place there. 7 While the defendant accepted that its plea to the charge had been properly entered, it was submitted that the responsibility of the Corporation for the safety infrastructure at the wharf in the circumstances of the defendant's hire of a part of the wharf on the day in question, was a matter relevant to the amount of the penalty to be imposed. 8 Evidence was led as to safety measures which the defendant had put in place at another wharf, Koorang No 2, which it operated and where it had the responsibility for the safety infrastructure. This included reference to the health and safety procedures manual which there applied, including in relation to access and designated walkways. Attention was drawn to the fact that such safety measures were in place at Koorang, but not Throsby wharf, a matter of some significance, it was submitted, given the common user nature of the latter wharf. 9 The defendant's health and safety manual made clear that there were steps available, which could have been taken at Throsby wharf in relation to access to the working site, which would have prevented the accident, but which were not taken by the Corporation. 10 One of the consequences of the accident had been that the defendant no longer used the Throsby wharf. Immediately after the accident the defendant's health and safety committee had met to consider what had occurred. Its report led to an internal review of safety procedures by the defendant, which involved the retention of an external safety provider. As a result, five safe working procedures were specifically formulated for the defendant's Newcastle operation, which had been implemented at Koorang and Throsby, while it was being utilised by the defendant. Those procedures achieved the removal of pedestrians from the area in which forklifts carrying containers were operating. The approach adopted was that the utilisation of a spotter was not appropriate, that causing a risk to safety of a different kind. 11 It was submitted that given the common user nature of Throsby wharf, it would be accepted that pedestrian traffic at the wharf was a matter within the control of the Corporation at the time, not the defendant's. 12 Reference was also made to an earlier circumstance when an injury had occurred at Throsby wharf. On the day in question, while the wharf had been hired by the defendant, it had not in fact been using it. On that day, the Corporation had opened the wharf for the day and had allowed the friends and family of those sailing on a naval ship moored at the wharf access to the wharf. It was submitted that the circumstance put into context the way in which the Corporation controlled access to the wharf. 13 Reference was also made to General Safety Rules developed after the accident by the MSB Hunter Ports Authority, which owned the wharf and the Corporation. An access gate at the wharf was closed, so that access to the site and traffic coming onto the site could be regulated by the Corporation. 14 Reference was also made to a booklet developed by the defendant for provision to new employees, which was also being distributed to existing employees, in order to focus attention on safety matters, as well as new emergency procedures, which included a direction about remaining in the cab of a vehicle during waiting periods. There was also evidence of the steps taken by the defendant to inform the WorkCover Authority of what it had done in order to rectify the factual circumstances which had given rise to the accident. These were taken in response to notices issued by the Inspector. 15 It was also submitted to be relevant to penalty that here there was an early plea of guilty and clear co-operation by the defendant with the WorkCover Authority. In utilitarian terms court time had been saved as a result. Discussions between the parties led to the withdrawal of a number of summonses, which also evidenced the co-operation which had been afforded. 16 As to culpability, it was submitted that the position of the Corporation was relevant. Some of the matters referred to in the agreed statement of facts were within the control of the Corporation and not the defendant. This was relevant to an assessment of the nature and quality of the offence with which this defendant was charged. It would be accepted that in the circumstances of the offence the culpability of the Corporation was greater than that of the defendant. The Corporation had been prosecuted, but the prosecution was awaiting trial. 17 Reference was made to the decision in WorkCover Authority of New South Wales (Inspector Barber ) v Softwood Holdings Limited t/as CSR Timber Products (1999) 89 IR 40. It was submitted that while there were some similarities in the circumstances there under consideration with those which arose in this case, there were differences. These included that in this case there was no direct linkage between the person injured and the defendant. This was relevant when consideration was given to steps available to a defendant to assist someone injured. There was, for instance, no opportunity to repeat steps already taken by the direct employer. 18 In Softwood Holdings, a penalty of $60,000 was imposed. It was submitted that this provided guidance in this case, where the maximum penalty was $500,000, not $550,000. 19 It was further submitted that in this case of a first offence by a defendant which had operated wharves for many years, its record would be regarded as an excellent one. The industry plainly had inherent dangers, as did forklift operation itself. It followed that there was no need for an element of specific deterrence in any penalty imposed here, even though it was accepted that an element of general deterrence also had a role to play in the imposition of any penalty. 20 As to the defendant's record, it was also submitted that it would not be overlooked that the defendant had moved a significantly large number of containers over very many years, not just from ship to wharf, but also from wharf to ship and otherwise around the wharves, without prosecution under the Act. It was in the light of that record that the departures from safety in this matter were to be judged. 21 For the prosecutor it was submitted by Ms Thompson of counsel that the defendant had been charged with one particular failure, namely failing to ensure that measures were in place to ensure that restricted access existed to areas where the defendant's forklifts were operating at the Throsby wharf. 22 The primary matter to be considered was the objective seriousness of the offence charged or in other words, its nature and quality. The position was that Mr Giles had left his vehicle, had located some twist locks in a single half height container on the wharf, had climbed in to retrieve them and then climbed out backwards, so that he was standing between a number of containers, when the container he had climbed out of was bumped by the driver of the forklift, an employee of the defendant. 23 The driver could not see where he was going, given the containers he was moving. Bumping was the work method in place for locating containers at the wharf. The driver was not aware of Mr Giles' presence and did not check whether anyone had entered the site. Neither the defendant nor the Corporation had procedures in place restricting access to the site or any reporting measures when access was given. 24 The system of entry to the site was inherently dangerous and was compounded by the forklift operation. The operator had limited, if any, relevant vision, leading to the practice of bumping. 25 The safety of Mr Giles could have been secured by restricting access to the site. The risk of injury, in these circumstances, was obvious and could have been prevented by use of measures such as barriers, or the forklift carrying only one container, so as to give the forklift driver visibility. The failure to put in place simple and available measures used at the defendant's other wharf at Throsby, which was a temporary worksite, exacerbated rather than mitigated the seriousness of the offence. 26 While the defendant relied upon its good record, it couldn't be ignored in this case, so it was submitted for the prosecutor, that in some cases a good record followed upon good luck, not good management. Relevant to this submission was the procedures manual on which reliance was placed. Many of the procedures there seemingly applying to the defendant's restricted areas, were readily available to have been implemented at the Throsby site. 27 It was submitted that under the Act the defendant had an obligation to provide safe working methods and to take positive steps to ensure that this was achieved. The fact that a forklift driver with limited sight came into contact with someone who had strayed into the area where the forklift was being operated highlighted the nature and quality of the offence in question. 28 It was accepted that the defendant was entitled to have its plea taken into account, as well as its co-operation with WorkCover. The prior record and subsequent steps taken by the defendant were also relevant, but had to be balanced against the strength of the case against it. 29 It was also accepted that there was a shared culpability between this defendant and the Corporation, but it was submitted that they each had with different areas of responsibility. The defendant had its employee working with a forklift in a manner which posed a clear risk to safety, with no readily available steps taken to address obvious risks. 30 It was also accepted to be relevant that the defendant had not only responded to the particular circumstances of the accident itself, but had reviewed its entire operation, having regard to the problems which had been highlighted.

Consideration 31 The proper approach to the assessment of penalty has been oft discussed and need not here be repeated. A penalty must reflect the nature and quality of the offence in question and in the case of a plea, must be approached on the basis of the principles established in Thomson. 32 In this case it cannot be doubted that the defendant has an impressive safety record. The industry in question is plainly an inherently dangerous one, as is the operation of forklifts themselves. I cannot see how that record can be dismissed as one achieved merely as the result of good luck, rather than good management, as the prosecutor submitted. It follows that the fact that this is a first offence for this defendant, is a matter which must be taken into account in assessing penalty. 33 The position as to the making of an early plea and the co-operation of the defendant with the WorkCover Authority is also undoubted and must lead to a reduction, as must the defendant's obvious contrition. The prosecutor submitted that a discount for the utilitarian value of a plea in this case should not be at the top of the range, but no lower than the middle. An assessment was required of the complexity of the issues raised and the length of any trial. Here the issues were not complex and any trial would not have taken long. 34 As to any reduction reflecting contrition or remorse or witness vulnerability, it was relevant that the latter was not an issue, as it might have been in an offence involving sexual assault. This element should thus not be reflected in any reduction. 35 Any discount in relation to contrition should involve a consideration of whether the plea resulted from a recognition of the inevitable. (See Thomson at para 14 and 137.) Here it was likely that there would have been a conviction and thus no significant reduction would flow from contrition evidenced from an early plea. Factors such as the assistance provided to the wife of the deceased would be weighed as part of the 'instinctive synthesis' involved in assessment of penalty. 36 For the defendant it was submitted that an early plea was entered, following upon the prosecutor's amendment of the summons. As a result a contested hearing, court time and costs were saved and witness inconvenience avoided. It followed that a substantial benefit towards the upper end envisaged in Thomson would flow. 37 The judgment in Thomson makes plain, (at para 151), the utilitarian value of early pleas vary from time to time and from one criminal justice system to another. A number of decisions of this Court have followed the approach outlined in Thomson in the context of the criminal justice system established by the Act. The range for discount for utilitarian savings is 10% to 25%. 38 Here there was an early plea entered, the primary consideration, (Thomson at para 160(iii)), in a case which was strong from the prosecution's point of view. This circumstance arose after the prosecution had amended its summons. It follows that the defendant should receive a substantial discount, having in mind that the issues raised were not of great complexity, so as to require a lengthy trial. I have concluded that the appropriate discount is 22% for this factor. 39 I have also concluded that while it might be correct that in this case the plea entered also recognised that a conviction would follow a contested hearing, it also reflected the genuine contrition of the defendant, in the context of its first offence under the Act. This was evidenced in a number of ways, including the plea, the assistance provided to the deceased's wife, the steps taken to revisit the safety risk identified in relation to all of its operations and its co-operation with the prosecuting authority. In this respect, I have concluded that a discount of 8% was warranted, making a total discount of 30%. 40 The sentencing task itself of course is an 'instinctive synthesis', as discussed in Thomson, particularly at para 122. Relevant to this process are the matters mentioned in relation to the nature and quality of the offence, as well as the evidence which demonstrated that the defendant took quick steps to address the risk to safety which the accident had highlighted, not only in relation to its operations at the Throsby wharf, but generally throughout its operations. It is also relevant that this was not a defendant which had disregard for safety matters prior to the accident, but rather a well developed regime in relation to safety issues, which it took steps to revisit as a result of the accident which here occurred. 41 I also accept that account must be taken of the responsibility which the Corporation had for access to the site, as the result of the way in which it operated the hire of the site to various users. Nevertheless, the accident highlighted that the way in which the work in question had been organised by the defendant was deficient in a number of obvious respects. 42 The way in which the Corporation dealt with access to the wharf was a matter which the defendant should have taken into account in its own work organisation, given the onerous responsibility which the Act imposed upon it. The defendant's plea, of course, accepts its failure in that regard. 43 The deficiencies in the defendant's approach were readily foreseeable, particularly given arrangements in place at other wharves which the defendant operated. The deficiencies were later addressed by the introduction of a number of steps which would have readily been available to the defendant prior to the accident. 44 It follows that the detriment to safety which arises for consideration was a serious one. The need for particular vigilance to be taken where a forklift is being operated in such a way that the driver's visibility is obscured by the load is obvious. In this case the practise of bumping the containers was developed for that very reason. The very fact that the defendant did not have the ability to control access to the place where the forklifts were being so operated, should have highlighted the need for appropriate safety steps to be taken, to prevent access to the place where the forklift was so operating. 45 Yet again the words of Hill J in WorkCover Authority of New South Wales (Inspector Egan) v Atco Controls Pty Limited (1998) 82 IR 80 at 85 bear repeating: 'This case is yet another illustration of the need for employers to exercise abundant caution, maintain constant vigilance and take all practicable precautions to ensure safety in the workplace. It is essential that the approach should be a pro-active and not a re-active one; employers should be on the offensive to search for, detect and eliminate, so far as is reasonably practicable, any possible areas of risk to safety, health and welfare which may exist or occur from time to time in the workplace. I am satisfied that the defendant approaches its duties under the Act on that basis. But it is always possible to achieve greater effectiveness and success as this case demonstrates.'

46 Having this observation in mind, the circumstances of this accident and the repeated decisions of this Court and its predecessor in relation to the need for vigilance when operating forklifts, I cannot accept that the need for specific deterrence has no role to play in the sentence imposed in this case. 47 Having taken into account all of the factors I have earlier referred and having applied the discount earlier referred to, I have concluded that the appropriate penalty for this first offence is $65,000.

Orders 48 For all of the reasons given, I find the defendant guilty of the charge and order it to pay a penalty of $65,000 with a moiety to the prosecutor. 49 In the event that there is any disagreement in relation to the appropriate costs order, the parties have liberty to approach.

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