WorkCover Authority of NSW v Anywhere Tower Cranes Pty Ltd; WorkCover Authority of NSW v Ghada Nouh; WorkCover Authority of NSW

Industrial Relations Commission (NSW)|2007-02-22|Before: Marks J, Mr J

Industrial Relations Commission of New South Wales in Court Session

CITATION: WorkCover Authority of NSW v Anywhere Tower Cranes Pty Ltd; WorkCover Authority of NSW v Ghada Nouh; WorkCover Authority of NSW (Inspector Jones) v Gabris; WorkCover Authority of NSW v Missingham [2007] NSWIRComm 44

PROSECUTOR WorkCover Authority of New South Wales (Inspector Alan Jones_

DEFENDANTS Anywhere Tower Cranes Pty Ltd PARTIES: Ghada Nouh

OH&S - guilty pleas - Corporate defendant to provide crane, crew & other personnel to builder - employed manager in charge of operations - office secretary consented to become director on commencement of employment - corporate defendant outsourced provision of crane operators to labour hire company - provide crane operators - incident occurred where crane toppled over and fell into street. HELD: Corporate defendant - objective seriousness - no effective or appropriate system for instruction & supervision of crane operator - deficiencies in crane equipment and operation - limited system & process designed to comply with OH&S responsibilities - not in place on date of incident - specific deterrence - company has not operated in crane industry since incident - general deterrence - early plea - expression of contrition - no prior convictions - no evidence with respect to current activities - monetary penalty imposed.

Sole director - performed administrative tasks only - no involvement with management - ultimate controlling mind - monetary penalty imposed. CATCHWORDS: Manager - requisite degree of complicity - application of Fines Act - principle of parity - monetary penalty imposed.

Labour hire company under external administration - failed to carry out risk assessment, job analysis, instruction or supervision - breach objectively most serious - sole director bankrupt - imposition of monetary penalty on bankrupt - fine not provable in bankruptcy - monetary penalty imposed.

LEGISLATION CITED: Fines Act 1996 Occupational Health and Safety Act 2000

CASES CITED: Inspector Wilkie v Anstee (No. 2) [2007] NSWIRComm 20 Newcastle Wallsend Coal Company Pty Ltd and ors v Inspector Martin [2006] NSWIRComm 339

PROSECUTOR Mr D B O'Neil of counsel SOLICITOR: Ms F Miller WorkCover Authority of NSW

DEFENDANT (in matter IRC No 5524 of 2005) Mr K P Dailley of counsel SOLICITOR: Mr J Hall LEGAL REPRESENTATIVES: Teakle Ormsby Conn

DEFENDANT (in matter IRC No 5525 of 2005) Mr J F Heazlewood of counsel SOLICITOR: Ms R Krysyna Wynn Willett Lawyers

DEFENDANT (in matter IRC No 5523 & 5526 of 2005) SOLICITOR: Mr J Hancock Hancocks Solicitors

1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

Inspector Alan Jones v Anywhere Tower Cranes Pty Ltd

Prosecution under s8(2) of the Occupational Health and Safety Act 2000

Inspector Alan Jones v Ghada Nouh Inspector Alan Jones v Tom Gabris

Prosecutions under ss26(1) and 8(2) of the Occupational Health and Safety Act 2000

Prosecution under ss26(1) and 8(1) of the Occupational Health and Safety Act 2000

1 The prosecutor Inspector Alan Jones of the WorkCover Authority of New South Wales has charged four defendants with breaches of the Occupational Health and Safety Act 2000 ("the Act"). All of the prosecutions arise out of the one set of circumstances although the involvement of each of the defendants differs in a material manner. 2 The incident occurred on 6 November 2003. A mobile crane had been made available by the first defendant, Anywhere Tower Cranes Pty Ltd ("Anywhere Tower"), to Karimbla Construction Services Pty Ltd, which had been engaged by Meriton Apartments Pty Ltd as the builder of an apartment development being constructed at the corner of George and Charles Streets, Parramatta. The defendant, Ghada Nouh, was the sole director of Anywhere Tower. Anywhere Tower arranged for a labour hire company, Cashbend NSW Pty Ltd ("Cashbend"), to provide a crew to operate the crane at the building site. The defendant Wayne David Missingham was the sole director of Cashbend. Cashbend made available three employees to operate the crane. The outriggers of the crane were not fully extended because a traffic management plan had left only a limited space for the footprint of the crane. During the course of the day, whilst the crane was operating, the nature of the material which it was being used to load and move changed to much heavier material. The weight of that material was such that on one load it exceeded the safe working load of the crane. During the course of moving the load, the crane toppled and fell into the street. Fortunately, no one was injured when this occurred. The defendant, Tom Gabris, was a manager of Anywhere Tower and had overall responsibility to implement that company's occupational health and safety systems. 3 In order to describe the nature of the offences alleged against each defendant by the prosecutor, it is necessary to set out the provisions of ss8(1) and 8(2) and 26 of the Act which are in the following terms. 8 Duties of employers (1) Employees An employer must ensure the health, safety and welfare at work of all the employees of the employer. That duty extends (without limitation) to the following: (a) ensuring that any premises controlled by the employer where the employees work (and the means of access to or exit from the premises) are safe and without risks to health, (b) ensuring that any plant or substance provided for use by the employees at work is safe and without risks to health when properly used, (c) ensuring that systems of work and the working environment of the employees are safe and without risks to health, (d) providing such information, instruction, training and supervision as may be necessary to ensure the employees' health and safety at work, (e) providing adequate facilities for the welfare of the employees at work. (2) Others at workplace An employer must ensure that people (other than the employees of the employer) are not exposed to risks to their health or safety arising from the conduct of the employer's undertaking while they are at the employer's place of work.

26 Offences by corporations - liability of directors and managers

(1) If a corporation contravenes, whether by act or omission, any provision of this Act or the regulations, each director of the corporation, and each person concerned in the management of the corporation, is taken to have contravened the same provision unless the director or person satisfies the court that: (a) he or she was not in a position to influence the conduct of the corporation in relation to its contravention of the provision, or (b) he or she, being in such a position, used all due diligence to prevent the contravention by the corporation. (2) A person may be proceeded against and convicted under a provision pursuant to subsection (1) whether or not the corporation has been proceeded against or been convicted under that provision. (3) Nothing in subsection (1) prejudices or affects any liability imposed by a provision of this Act or the regulations on any corporation by which an offence against the provision is actually committed. (4) In the case of a corporation that is a local council, a member of the council (in his or her capacity as such a member) is not to be regarded as a director or person concerned in the management of the council for the purposes of this section.

4 The defendant Anywhere Tower was charged with a breach of s8(2) of the Act. The defendants Ghada Nouh and Tom Gabris were charged with a breach of the same provision of the Act by reason of the application of s26 in that they were, respectively, a director of and a person concerned in the management of Anywhere Tower. The defendant, Wayne David Missingham, was charged with a breach of s8(1) of the Act by reason of the application of s26, he being the sole director of Cashbend. For completeness I add that Cashbend is under external administration. Mr Missingham was made bankrupt on 9 February 2006. 5 Each of the defendants pleaded guilty. The proceedings against each of them were heard concurrently with evidence in the one being evidence in each of the others. The prosecution sought orders for a moiety and costs, which were not opposed. 6 There was tendered into evidence a prosecutor's statement of facts with respect to the defendants Anywhere Tower, Ghada Nouh and Tom Gabris. That statement of facts is in the following terms: "1. Inspector Alan Jones of the WorkCover Authority of New South Wales, Level 3, 92 - 100 Donnison Street, Gosford in the State of New South Wales was an Inspector duly appointed under Division 1 of Part 5 of the Occupational Health and Safety Act 2000 ("the Act") and empowered under Section 106 of the Act to institute proceedings in the within matter. 2. Anywhere Tower Cranes Pty Ltd (ABN No: 57 101 121 555) was a corporation whose registered office is situated at Tax Management Consultants Pty Ltd, Suite 6, 207 Great North Road, Five Dock, in the State of New South Wales ("the first defendant").

Ghada Nouh of 3/39 Cornelia Street, Wiley Park, in the State of New South Wales ("the second defendant") was the sole director of the first defendant.

Tom Gabris of 1 Avro Place, Raby, in the State of New South Wales. ("the third defendant") was a manager of the corporation and had responsibility for the implementation of the corporation's occupational health and safety plan.

The first defendant was a corporation which undertook the business of mobile crane hire.

Meriton Apartments Pty Ltd ('Meriton") was the owner/developer of a construction site located at the Corner of George and Charles Street, Parramatta ('the site").

Karimbla Construction Services Pty Ltd ("Karimbla") was contracted by Meriton to be the builder of the apartment development being constructed at the site.

The first defendant had a daily hire agreement with Karimbla to provide crane, crane crew and personnel to carry out traffic control at the site. There was no written contract between the first defendant and Karimbla. The first defendant sent invoices to Karimbla for the labour and equipment provided by the first defendant at the site.

Under the agreement with Karimbla the first defendant provided a 50 Tonne Tadano crane with serial number 435924 ("the crane") for use at the site. The crane was owned by Santino's Cranes Pty Ltd ("Santinos"). The first defendant was responsible for costs of the maintenance and repair of the crane.

The first defendant had an agreement with Cashbend NSW Pty Ltd ("Cashbend"), a labour hire company, to the effect that required Cashbend to provide a crane crew to operate the crane at the site.

The first defendant also had an agreement with Clearwater Traffic Control ('Clearwater") to the effect that required Clearwater to provide personnel for traffic control duties for the site.

On 6 November 2003 Ross Walsh was employed by Cashbend as a crane driver and was undertaking crane operator duties at the site.

On 6 November 2003 Rodney Wall and Alex Milenov were also employed by Cashbend NSW Pty Ltd and were undertaking dogman duties at the site.

On the 6 November 2003 at approximately 10:20am the crane being operated by Ross Walsh became unstable and toppled over while attempting to lift a pallet of fibre cement (wallboard) sheeting in Charles Street, Parramatta.

Prior to the incident two pallets of gyprock sheeting had been unloaded by the crane crew from a truck that was located at the northern end of Charles Street, adjacent to the front of the crane carrier.

The pallets of gyprock sheeting had been slung by Alex Milenov and were moved in two separate lifts to an area located to the north of the crane where they were positioned on the overhead hoarding by the receiving dogman, Rodney Wall. The operating radius of the crane during this operation was approximately 10 metres.

Sheets of gyprock weighing between 570kgs & 5880.6kgs had been delivered to the site on 6 November 2003 by CSR Building Materials ("CSR"). Ross Walsh estimated that the gyprock sheeting lifted on 6 November 2003 weighed approximately 1.8 tonne. These weights were within the working load limit of the crane considering the operating radius of the crane was approximately 10 metres.

Following the completion of these lifts a third lift was to be carried out from the truck to an area located on the southern end of the hoarding at a radius of approximately 21 metres. Alex Milenov proceeded to sling a pallet of wallboard sheeting. The crane operator, Ross Walsh was not told that the load being lifted at the time the incident occurred had been changed from gyprock to wallboard sheeting.

Ross Walsh then raised the load to a height of approximately 40m while luffing the boom up to enable the safety screens of the building to be cleared. He then proceeded to slew the crane around approximately 1800 towards the building under construction. When the boom had cleared the building Walsh then jibbed down to an operating radius of approximately 21 metres. At this stage he received a signal from Rodney Wall to lower the hook. Ross Walsh then ceased jibbing down and proceeded to lower the load. Ross Walsh then noticed that the crane was starting to become unstable. He attempted to jib up but was unable to prevent the crane from becoming unstable.

The crane then toppled over towards the southern end of Charles Street, where the boom struck a truck mounted concrete placing boom that was being operated from level 7 of the building under construction.

The boom struck the barrel of a concrete delivery truck narrowly missing two employees of Boral Concrete, William Karydis and Mathew Ardus, before it came to rest in Charles Street.

The pallet of wallboard sheeting landed on top of a wheel barrow on the site, narrowly missing Daniel Upton, an employee of Karimbla who was preparing to move the wheel barrow.

Rodney Wall who was waiting to receive the load, ran for cover under the building under construction when he saw the crane falling towards him. He did not suffer physical injury but was absent from work on stress leave for a period of approximately six to eight weeks following the incident.

On 6 November 2003 CSR had delivered wallboard sheeting with weights ranging between 3017kgs & 3911kgs to the site. These weights would have been increased with the inclusion of the hooks and lifting equipment that were being used. The working load limit of the crane while operating with its outriggers fully extended at an approximate radius of 20 to 22 metres ranged between 2450kgs to 3200kgs.

There were traffic control procedures in place on 6 November 2003 at the site. These traffic control procedures included maintaining a 2-way traffic flow in Charles Street. The traffic control procedures that were in place in Charles Street when the incident occurred were not suitable for the crane that was in operation, as they did not allow for full extension of the crane's outriggers.

Karimbla said that it had developed a traffic management plan for the site. This plan required two way traffic flow in Charles Street. A copy of the traffic management plan was unable to be located by Karimbla when it was requested by WorkCover.

Parramatta City Council had not received an application for road occupancy by a crane for 6 November 2003.

The outriggers of the crane closest to the centre of Charles Street, Parramatta were not fully extended when the incident occurred. These outriggers were not fully extended to allow for the positioning of the red witches hats that were used to delineate the traffic lanes and to maintain a 2-way traffic flow in Charles Street. Traffic control procedures to maintain one lane traffic flow on Charles Street would have allowed the crane's outriggers to be fully extended.

The defendants did not ensure that the traffic control procedures that were in place in Charles Street on 6 November 2003 were suitable for the safe operation of the mobile crane that they had supplied.

The crane crew received instructions for the work they were to do at the site from Boris Miletic, leading hand builder's labourer employed by Karimbla and Dennis Paleothodoros, site supervisor employed by Karimbla. Karimbla determined what work was to be undertaken and where the crane was to be set up.

On 6 November 2003 Boris Miletic had instructed the crane crew as to where to set up the crane and what jobs they were to undertake. Neither Boris Miletic or Dennis Paleothodoros provided any further instruction to the crane crew. Mr Miletic advised that he left how the job was to be set up to the crane crew.

The crane crew did not have a dedicated supervisor at the site. No supervision, instructions or information was provided to the employees involved in the operation of the crane on 6 November 2003 by the first defendant.

The area where the crane was to operate in Charles Street was inspected during the contract process by the third defendant. The inspection was not documented. The first defendant had no documented procedures for the assessment of the area where mobile cranes were to be set up and operated. The first defendant did not conduct an adequate risk assessment as to the suitability of the area where the crane was set up and operated in Charles Street, Parramatta.

The first defendant advised they provided a Job Safety Analysis (JSA) to Karimbla in accordance with Karimbla's Site Occupational Health and Safety Management Plan. The JSA required that prior to a job being commenced a pre job site inspection and tool box talk was to be performed. This was not undertaken on 6 November 2003.

The crane operator, Ross Walsh was not informed that the load being lifted at the time the incident occurred had been changed from gyprock to wallboard sheeting.

Ross Walsh said that there was an ongoing problem with the operation of the Automatic Moment Limiter ("AML") fitted to the crane in that the weight gauge provided fluctuating readings. Due to this problem the crane was operated with the AML overridden. The crane had a locked position switch which would allow permanent override. The AML when in working order stops crane function at 100 percent safe working load. Given the AML was overridden there was no warning device in operating on the crane to advise the crane driver that the load being lifted was over the safe working load.

Ross Walsh had reported the defective operation of the AML to Tom Gabris, prior to the incident. The defect was also noted in the crane log book on 2 November 2003. No documentation could be provided by the defendants to confirm that repairs had been carried out in relation to the problem with the weight gauge noted on 2 November 2003 in the crane long book.

Due to the weight and radius of the load being lifted and the configuration of the crane the Working Load Limit of the crane was exceeded.

Subsequent to the incident on 6 November 2003, Inspector Richard Whitehead of the WorkCover Authority attended the site and made the observations. Inspector Whitehead also took a number of photographs and completed a Factual Report of his inspection.

The following supporting documentation is annexed: A) 12 Colour photographs taken by Inspector Whitehead B) Factual Inspection report of Inspector Whitehead C) Factual Inspection report of Inspector Jones D) The first defendant's JSA WorkSheet 42. The defendants have no prior convictions under the Act." 7 A statement of facts in similar terms was tendered in the proceedings against Mr Missingham. That statement of facts established that Mr Missingham was the sole director of Cashbend, that Cashbend was in the business of labour hire and that it employed Ross Walsh as a crane driver to undertake crane operator duties at the site and Rodney Wall and Alex Milenov to undertake dogman duties at the site.

8 In addition to these documents, the prosecutor tendered into evidence a statement to the prosecutor made by Ross Walsh and a flowchart from Anywhere Tower papers. 9 Affidavit evidence of Ghada Nouh and Tom Gabris was tendered and Mr Gabris gave oral evidence and was cross-examined on his affidavit. 10 For completeness, I note at this stage that none of the defendants has any prior convictions. The maximum penalty applicable to Anywhere Tower is $550,000 and to each of the individual defendants $55,000. 11 Before discussing the individual circumstances of each of the defendants in connection with the objective assessment of the offences committed by them, I make some general observations about the management of the building site and the circumstances in which the corporate defendant Anywhere Tower and the company Cashbend came to be involved. Anywhere Tower had a contract with Karimbla to provide cranes, crane crew and personnel to carry out traffic control at the site. It will be remembered that Karimbla was the builder of the development on behalf of the owner/developer, Meriton. Anywhere Tower appears to have obtained the crane in question from Santino's Cranes Pty Ltd, the owner of the crane. It then obtained the personnel necessary to operate the crane from Cashbend, a labour hire company and the personnel to perform traffic control duties at the site from Clearwater Traffic Control. Accordingly, Anywhere Tower appears to have outsourced all of its contractual obligations to Karimbla by way of material and personnel. The only control that it could directly exercise in terms of the management and administration of its contractual arrangements with Karimbla would occur through the use of its own managerial and supervisory staff who, as I understand the evidence, were direct employees of Anywhere Tower. There were three such persons, one of whom was the defendant Mr Gabris. 12 The evidence given in the proceedings enables the following factual conclusions to be drawn: 1) At the time of the incident and at all relevant times on that day, Anywhere Tower did not have present any supervisory personnel. Anywhere Tower appears to have contracted to provide supervisory personnel at the building site. 2) The operator of the crane, Mr Ross Walsh, employed by Cashbend, had been a certified crane driver for about 25 years and had been in the industry for about 36 years. 3) Just before the incident, Mr Walsh reported to "Santo's Cranes" of which he described the defendant Mr Tom Gabris as "the manager" that a computer installed in the crane to estimate the weight of a load was not operational. It remained inoperable on the day of the incident. Furthermore, a device known as an Automatic Moment Limiter, which precluded the crane from operating where the maximum load was exceeded, had been overridden. 4) The incident occurred when the material being lifted by the crane was changed from gyprock to fibro, increasing the load from about 1.8 tonne to nearly 3 tonne. Mr Walsh was not told that the material had been changed and the weight increased. 5) The outriggers of the mobile crane had not been fully extended so that traffic could continue to flow in both directions simultaneously in Charles Street Parramatta. 6) A buzzer alarm system intended to give a warning when an unsafe load was being carried did not operate. 7) Anywhere Tower was required by its contract with Karimbla to provide a job safety analysis. This required a site inspection prior to work being carried out and the conducting of a "toolbox talk" to the persons involved in performing the work. This did not occur on the day of the incident. Although the site had been inspected in a general sense previously by Mr Gabris no written report of the site inspection was carried out by him. 13 In his evidence, Mr Gabris conceded that there should have been supervision at the Parramatta site on the day of the incident. He thought that on the day of the incident Anywhere Tower had about 19 cranes operating on other sites and he had chosen to go to a site at Bondi Junction that day. The company had two other persons available who were competent to supervise crane operations but he was unsure where they were. In his evidence Mr Gabris said that if he had been supervising the crane operation work he would have arranged for the outriggers to be fully extended and for the lift to be undertaken in a different way. He said the system in place to undertake the actual lift was unsafe. 14 However, it was the evidence of Mr Gabris that Anywhere Tower did have in place a system of risk assessment and inspection of work sites as well as a system involving toolbox meetings with crane operators. In addition, Anywhere Tower provided logbooks for each crane in which operational problems were to be recorded and which he viewed on a regular basis. The Anywhere Tower occupational health and safety systems ensured that crane operators were equipped with two-way radios, work boots and other safety equipment. 15 Having regard to these observations, it is now necessary to assess the objective seriousness of the offence against both Anywhere Tower and against Cashbend. The offence committed by Anywhere Tower is relevant to the proceedings against that company and against Ms Nouh and Mr Gabris. The offence committed by Cashbend is relevant with respect to the proceedings taken against Mr Missingham.

Anywhere Tower 16 There can be no doubt that this was a serious offence. The use and operation of a mobile crane is, of itself, one with a potential to create risks to health and safety and the size of the crane in question always created a risk that if anything went wrong, there was a real potential to cause injury to persons. This is especially so given the close proximity of the crane to a building site and the operation of the crane in a thoroughfare being used by vehicular traffic. I have already outlined the factual circumstances surrounding the incident. It is clear that Anywhere Tower did not have in place on the day of the incident effective and appropriate systems for the instruction and supervision of the crane operator, that there were deficiencies in the crane equipment itself and that the operation of the crane was deficient in a number of aspects. 17 However, in assessing the objective seriousness of the offence committed by Anywhere Tower I take into account the fact that it did have in place systems and processes designed to comply with its occupational health and safety responsibilities, albeit they failed on the day of the incident. On this basis, this offence is not in a worst-case scenario. 18 It was the evidence of Ms Nouh that the company has not operated "in the crane industry" since the date of the incident. This is a matter that I will take into account in determining the specific deterrent effect of any penalty. However, there remains to be taken into account the general deterrent effect within the industrial community. 19 I accept that with respect to this defendant, and indeed with respect to all other defendants, there has been cooperation with the WorkCover Authority of New South Wales, pleas of guilty have been entered at the earliest appropriate opportunity, there have been expressions of contrition and remorse and there are no prior convictions with respect to any offence under Occupational Health and Safety legislation. 20 The maximum penalty applicable to Anywhere Tower is $550,000. 21 As I have previously indicated, I regard the offence as a most serious one tempered only by the fact that the company did have in place some systems designed to comply with its occupational health and safety obligations, albeit they were not followed on the occasion of this incident. In terms of the specific deterrent effect of any penalty I note that the company has not engaged in any operations with respect to the use of cranes since the incident. However, there is no evidence before the Court with respect to the current activities of the company and it may well be continuing to trade. There is, of course, the necessity to take into account the general deterrent effect of the penalty. Having regard to these matters and to the subjective matters to which I have referred, I am of the opinion that the appropriate penalty is the sum of $100,000.

Ghada Nouh 22 As I have previously observed, this defendant is charged with the same offence as Anywhere Tower by reason of her directorship of the company, pursuant to the provisions of s26 of the Act. 23 In an affidavit filed in the proceedings, Ms Nouh said that she consented to become a director of Anywhere Tower in June 2003 at which time, as I understand her affidavit, she commenced to work as a secretary in the company's office. She said her duties "involved office work, invoicing, pricing dockets, computer work, letters and general office duties. I took no part in the operations of the cranes or any contractual work. Over the next three years my duties did not change. The company employed Tom Gabris as manager and he was in charge of all operations….I had no experience in crane operations." 24 In a supplementary affidavit, Ms Nouh has stated that she was not intending to raise any statutory defence available to her under s26 of the Act. She said, "I accept that as the sole director of the company I was responsible for the actions of the company." 25 Ms Nouh appears to have performed work of a secretarial and administrative kind only and appears to have had no involvement in the management of the company. A company search, which became evidence in the proceedings, indicated that she was the sole director. The sole shareholder appears to be Giovanna Callus but no other details are revealed other than this person's address. 26 There is no evidence before the Court concerning the circumstances in which and the reason why Ms Nouh became the sole director of the company. The consequence for her is that at law she has become the ultimate controlling mind of the company with respect to its day-to-day affairs subject only to the overriding, but extraordinary control, at the hands of the sole shareholder. As sole director, therefore, Ms Nouh has exposed herself, as she accepts, to liability for prosecution under the Act and, indeed, has pleaded guilty to the charge brought against her. Whether and to what extent Ms Nouh contemplated the prospect of prosecution for a breach of the Act when she agreed to become the sole director of the company is not known. In any event, the prosecutor, through his counsel, made it clear during the course of submissions that the WorkCover Authority of New South Wales takes the view that persons who are directors of corporations, particularly persons who are sole directors, are amenable to prosecution as a result of the provisions of s26 of the Act. 27 The position of directors may be contrasted with that of persons who are "concerned in the management of the corporation." This latter category of persons may have the benefit of a qualification concerning "complicity". I referred to this matter in my judgment in Newcastle Wallsend Coal Company Pty Ltd and ors v Inspector Martin [2006] NSWIRComm 339 at [717] and following. No such qualification appears to be permissible in the case of director. The only enquiry with respect to a director would appear to be the application of the defences available within s26 itself. 28 I would recommend that the WorkCover Authority of New South Wales, as part of its educational role, ensure that both executive and non-executive directors of corporations throughout New South Wales understand their exposure to prosecution by reason of the provisions of s26 of the Act in the event that any company of which they are a director commits a breach of the Act, save only for the defences available to them under s26. Such exposure to a criminal conviction is even more compelling where a director has no shareholding in, or any day-to-day involvement in the operations of, a corporation. 29 In her affidavit, Ms Nouh stated that she remains the sole director of Anywhere Tower solely because of these proceedings. That is, if she were to have resigned as a director after the commencement of the proceedings, there may have been no other person available to have ensured representation on behalf of the company. In my opinion, Ms Nouh is to be commended for this approach. 30 Ms Nouh stated in her affidavit that since September 2006 she has been employed as a casual promotions worker. She is married and resides with her husband and is expecting to give birth in August 2007. 31 The maximum penalty under s26 is $55,000. Having regard to the objective seriousness of the offence to which the company has pleaded guilty, as I have found, taking into account a lesser necessity to deal with specific deterrence and having regard to the subjective matters to which I have referred, I would impose a monetary penalty on Ms Nouh of $9,000. In doing so, I am conscious of the general deterrent effect that such a penalty and a criminal conviction will have on all other directors of corporations whose activities in New South Wales are exposed to obligations created by the Act.

Tom Gabris 32 I have already referred to the fact that Mr Gabris had a significant managerial role in the company Anywhere Tower and in particular with respect to its occupational health and safety obligations. Indeed, the evidence is that it was he who determined that there would be no supervisor on the site where the incident occurred. 33 There can be no doubt that Mr Gabris was a person concerned in the management of the company and complicit in the breach by that company of the Act. 34 An application was made on behalf of Mr Gabris under s6 of the Fines Act 1996, which is in the following terms:

In the exercise by a court of a discretion to fix the amount of any fine, the court is required to consider: (a) such information regarding the means of the accused as is reasonably and practicably available to the court for consideration, and (b) such other matters as, in the opinion of the court, are relevant to the fixing of that amount. 35 In his affidavit Mr Gabris said that he is the sole provider for himself and his de facto partner and their two children, aged three and two, as well as having responsibility for child support for two older children. He has mortgage payments and other expenditure leaving, prior to living expenses for himself and his family, about $600 per week. 36 In addition to a monetary penalty, Mr Gabris will be compelled to make a contribution to the prosector's costs and disbursements, which I am informed would be in the order of $4,000 in total. This includes a filing fee on the application for order of $1,300. 37 Whilst there must be some sympathy for the financial circumstances of Mr Gabris, I am conscious that it is also necessary to reflect the culpability of defendants when assessing penalty in compliance with the obvious intention of the legislation to make persons who are directors and persons who are concerned with the management of corporations susceptible to prosecution where the corporation is guilty of a breach. It would be inappropriate, in my opinion, if consistent with the principle of parity I were to impose a monetary penalty on Mr Gabris of less than that imposed on Ms Nouh given their differential involvement in the affairs of the company, particularly as those affairs impacted upon the circumstances in which the breach by the company was committed. Having regard to the involvement of Mr Gabris, but allowing for his financial circumstances as disclosed in the evidence, I intend imposing a monetary penalty on Mr Gabris in the sum of $9,000. I was informed during the course of the hearing that the WorkCover Authority of New South Wales has in place a process which assesses the capacity of defendants to pay fines and which allows for sensible arrangements to be put in place so that fines may be paid off over a period of time, which would not unduly intrude into the ability of a defendant to care for his or her family.

Wayne David Missingham 38 Mr Missingham is the sole director of Cashbend. That company is under external administration. 39 Obviously, the application of s26 of the Act to Mr Missingham is brought about by reason of the breach by Cashbend of the Act. 40 The evidence was to the effect that Cashbend did not inspect the site of the incident prior to sending its employees to perform work there, did not undertake any risk assessments in relation to that work and did not provide its employees with any safe work procedures. 41 There is no evidence that Cashbend had attempted in any way to comply with its undoubted obligations under the Act to persons whom it deployed as part of its labour hire business. It is a trite observation, supported by Full Bench authority in this Court over a long time, that labour hire companies are obliged to comply with the provisions of the Act as it affects their employees when assigning those employees to perform work, especially on third party premises over which they have no control. In failing to carry out any risk assessment, job analysis, instruction or supervision of its employees or to ensure that any of these matters had been attended to, the breach by Cashbend was of a most serious kind and more serious than that of Anywhere Tower, which at least did have certain processes in place in an attempt to comply with obligations under the Act. 42 It is on this basis that I approach the assessment of an appropriate penalty on Mr Missingham. He was, as I have said, the sole director of the company and therefore exclusively ultimately responsible for its day-to-day operations. 43 In submissions on behalf of Mr Missingham, it was suggested that Cashbend had relied on the expertise and supervision being carried out by others. Such a submission is facile and ignores the necessity to ensure that the requisite expertise and supervision is available, albeit carried out by others. 44 Evidence tendered in the proceedings suggests that Mr Missingham was made bankrupt on 9 February 2006. There was a suggestion that on this basis the fine should be reduced by reason of the provisions of s6 of the Fines Act 1996, which I have earlier set out. 45 The impact of the imposition of a monetary penalty on a bankrupt was recently considered comprehensively by Staff J in this Court in Inspector Wilkie v Anstee (No. 2) [2007] NSWIRComm 20. His Honour concluded that a fine imposed by this Court for a breach of the Act is not provable in bankruptcy and would therefore not deprive the creditors of the bankrupt of any access to funds. His Honour discussed the matter generally at [40] to [53]. 46 I respectfully agree with the reasoning of Staff J and with his Honour's conclusion. 47 I observe in the context of this defendant that it is difficult to ascertain whether and to what extent he will be able to pay any penalty imposed after discharge from bankruptcy. 48 I am not persuaded that I can take Mr Missingham's financial circumstances into consideration for the purpose of s6 of the Fines Act other than in a general manner for the purpose of ascertaining his ability to pay a monetary penalty after discharge form bankruptcy. This is especially so given the facility offered by the WorkCover Authority of New South Wales to assess the ability of a defendant to pay a penalty and to enter into an arrangement for payment by reasonable instalments. Such a facility is, of course, also available through application to the Registrar of this Court. 49 In all the circumstances having regard to the objective seriousness of the offence committed by the company Cashbend, the need to take into account the deterrent effect, at least in a general sense, but having regard also to the mitigating subjective factors to which I have referred, I intend imposing a monetary penalty of $15,000 on Mr Missingham.

Orders 50 I make the following orders: 1) Each of the defendants is found guilty of the offences as charged and convicted accordingly. 2) I impose penalties of $100,000 on the defendant Anywhere Tower Cranes Pty Ltd, $9,000 on each of the defendants Ghada Nouh and Tom Gabris and $15,000 on the defendant Wayne David Missingham with a moiety to the prosecution. 3) Each of the defendants is to pay the costs of the prosecution assessed by the Court in default of agreement.

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At a glance

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Judgment (69 paragraphs)

Cases Cited (2)

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