Citation: WorkCover Authority of New South Wales v Construere Projects Pty Limited [2014] NSWDC 310
Court: District Court of New South Wales
Date: 15 December 2014
Judge: Kearns SC DCJ
Background
Construere Projects Pty Ltd was a small building services company whose sole director, Mr Wansa, personally managed quoting, contractor engagement, and hands-on work. The company was regularly engaged by a fuel and petroleum business to carry out maintenance work, including air conditioning installation and repair, at petrol station sites.
In October 2012, Construere subcontracted Peter Wahhab, operating under the name Southern Cross Air Conditioning, to install a replacement air conditioning unit at a petrol station in Miranda, NSW. Mr Wahhab was in fact Mr Wansa's brother-in-law. Construere had engaged him on multiple prior occasions, and Mr Wansa, along with Mr Wahhab's own family, genuinely believed him to be qualified. In reality, Mr Wahhab had never completed his TAFE course in electrotechnology and held no contractor licence, supervisor certificate, or tradesperson certificate.
On 4 October 2012, while working alone in a store room at the site, Mr Wahhab received a fatal electric shock and was pronounced dead upon arrival at hospital. Construere had not verified his qualifications, had no system for identifying whether the work would involve electrical wiring, and had not taken steps to ensure the distribution board was de-energised before work commenced.
Legal Issues
- Whether Construere Projects Pty Ltd breached its duty under s 19(1) of the Work Health and Safety Act 2011 to ensure, so far as reasonably practicable, the health and safety of workers engaged by it
- Whether that breach exposed Mr Wahhab to a risk of death or serious injury, contrary to s 32 of the Act
- What the appropriate penalty was, having regard to mitigating factors including the guilty plea, the unusual personal circumstances, demonstrated remorse, and the need for both specific and general deterrence
Decision
Construere pleaded guilty to the charge. The agreed facts established a series of systemic failures: no process for verifying contractor qualifications, no assessment of whether the work would involve electrical wiring, no safe work procedure requiring de-energisation of the distribution board, and no consultation with Mr Wahhab about the hazards involved. The company had instead relied entirely on Mr Wahhab himself, who lacked the competence to identify and manage the risk of electrocution.
The court acknowledged several unusual mitigating features. Mr Wansa had genuine, reasonable grounds to believe his brother-in-law was qualified, a belief shared by Mr Wahhab's own family. The personal relationship between director and subcontractor explained, though it did not excuse, the failure to conduct formal qualification checks. The tragedy had a profound psychological effect on Mr Wansa, who was diagnosed with post-traumatic stress disorder, and the court accepted that his remorse was genuine and substantial.
On deterrence, the court found that specific deterrence was a less prominent factor given that Construere had since implemented rigorous safety practices and was unlikely to re-offend. General deterrence retained relevance, but the court noted that the particular circumstances, a director engaging a close family member in full and reasonable belief of his qualifications, were highly unusual and unlikely to recur frequently.
Before applying any discount, the court set a base fine of $50,000. A full 25 per cent discount was applied for the early guilty plea, producing a final fine of $37,500.
Orders Made
- Construere Projects Pty Ltd convicted of the charge under s 32 of the Work Health and Safety Act 2011
- Fined $37,500 (reduced from a base of $50,000 by a 25 per cent guilty plea discount)
- One moiety (half) of the fine directed to be paid to the prosecutor
- Defendant ordered to pay the prosecutor's agreed costs of $17,500
Key Takeaways
- The District Court confirmed that a corporate defendant's duty under s 19(1) of the Work Health and Safety Act 2011 extends to verifying the qualifications and competence of subcontractors engaged to perform specialist or electrical work, regardless of the personal relationship between the parties.
- A genuine and reasonable belief that a subcontractor was qualified, while relevant to mitigation, did not displace the obligation on the engaging entity to have systems in place to check qualifications and assess hazards.
- Where a director suffers profound psychological harm as a direct consequence of a workplace fatality involving a family member, that personal impact can be considered in assessing the corporate defendant's remorse, since a company acts through its human decision-makers.
- Significant weight was given to the unusual personal circumstances surrounding the engagement of the subcontractor, reducing the relevance of general deterrence compared with a more typical arms-length contracting relationship.
- An early guilty plea attracted a full 25 per cent discount under the Crimes (Sentencing Procedure) Act 1999, bringing the fine from $50,000 down to $37,500.
Legislation and Cases Referenced
Legislation:
- Work Health and Safety Act 2011 (NSW), ss 19(1) and 32
- Crimes (Sentencing Procedure) Act 1999 (NSW)
- Home Building Act 1989 (NSW) (provisions relating to contractor licences and specialist electrical and air conditioning work)
Cases cited: No cases were cited in the portions of the judgment provided.