Citation: Safe Work (NSW) v JSN Hanna Pty Ltd [2016] NSWDC 117
Court: District Court of NSW
Date: 4 July 2016
Judge: Judge AC Scotting
Background
The defendant, a small family building company acting as principal contractor for a residential unit development in Lane Cove, pleaded guilty to failing to comply with its health and safety duty under section 19(1) of the Work Health and Safety Act 2011, thereby exposing a worker to a risk of death or serious injury contrary to section 32. The maximum penalty for such an offence is a $1.5 million fine.
The incident occurred on 7 December 2012. A 17-year-old labourer, engaged by a sub-contractor several steps down the contractual chain, was working on a hop-up scaffold (a small platform extension) inside a four-storey lift shaft. While bracing a wall panel, he stepped onto a piece of timber secured to the wall for alignment purposes. That timber was not designed to bear weight, it gave way, and the worker fell approximately 12 metres. He suffered a head wound requiring 12 stitches, facial lacerations, neck pain, and bruising, and was absent from work for eight days.
The hop-up scaffold was accessible because handrails on one side of the lift shaft had been removed to allow access to it. A relevant Australian standard required edge protection wherever a person could fall more than two metres, subject to exceptions for gaps less than specified dimensions from a working face or structure. The gap through which the worker fell was approximately 500mm, which fell outside those exceptions.
Legal Issues
- What was the appropriate penalty for the principal contractor's breach of its work health and safety duty under sections 19(1) and 32 of the Work Health and Safety Act 2011?
- How should objective seriousness be assessed in light of the nature of the breach and its consequences?
- What mitigating factors applied, including the offender's prior safety record, post-incident remediation, cooperation with investigators, and plea of guilty?
- What discount was appropriate for the guilty plea, given the timing of that plea?
- How should the court account for agreed prosecution costs when setting the fine?
Decision
Judge Scotting assessed the objective seriousness of the offence as moderate. The principal contractor had taken extensive steps to comply with WHS obligations and had an impeccable prior safety record. The absence of guarding on the hop-up scaffold was characterised as an oversight in the implementation of an otherwise sound safety system, rather than a systemic failure. However, the unguarded platform created a substantial risk that directly materialised in the incident.
Several mitigating factors significantly reduced the penalty. These included the offender's prior record free of serious incidents, the extensive remedial steps taken after the incident (including installing additional scaffolding, commissioning a safety audit, and improving documentation of toolbox talks and inductions), genuine remorse and contrition expressed through Mr Hanna's affidavit, and cooperation with the investigation.
On the guilty plea discount, the court applied a 12.5% reduction rather than the maximum available discount. The matter had been listed for trial twice, and the plea was entered only after an amended summons was filed removing some particulars of the alleged breach. Some delay was attributed to the insolvency of a co-accused subcontractor and a period spent exploring an enforceable undertaking, which the court accepted as partial explanation.
The court noted its obligation to take the agreed prosecution costs of $70,000 into account when fixing the fine, citing Environmental Protection Agency v Barnes [2006] NSWCCA 246. Starting from a fine of $100,000, the court applied the 12.5% discount to arrive at a final fine of $87,500.
Orders Made
- The offender was convicted.
- A fine of $87,500 was imposed (reflecting a 12.5% plea discount on a base fine of $100,000).
- Pursuant to section 122(2) of the Fines Act 1996, 50% of the fine was ordered to be paid to the prosecutor.
- The offender was ordered to pay the prosecutor's agreed costs of $70,000.
Key Takeaways
- A principal contractor's responsibility under section 19(1) of the Work Health and Safety Act 2011 extends to ensuring that workers engaged by sub-contractors down the contractual chain are not exposed to risks of death or serious injury, even where the contractor had no direct knowledge of the specific unsafe practice on the day.
- The District Court treated an otherwise strong subjective case, including an impeccable prior safety record, genuine remorse, and substantial post-incident remediation, as significantly mitigating a penalty that might otherwise have been considerably higher against a maximum of $1.5 million.
- A guilty plea discount of 12.5% (rather than the maximum typically available) was applied where the plea came late in proceedings, after two trial listings and following the filing of an amended summons, notwithstanding partial explanations for the delay.
- Agreed prosecution costs formed part of the sentencing calculus: the court reduced the fine from what it might otherwise have set in order to account for the $70,000 costs order the offender would also bear, consistent with the approach in EPA v Barnes.
- Under section 122(2) of the Fines Act 1996, the court directed that 50% of the fine be paid to the prosecutor, a mechanism available in WHS prosecutions that practitioners should be aware exists as a distinct step in the sentencing process.
Legislation and Cases Referenced
Legislation:
- Work Health and Safety Act 2011 (NSW), ss 19(1), 32
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A
- Fines Act 1996 (NSW), s 122(2)
- Work Health and Safety Regulations 2011 (NSW), cl 299
- AS/NZS Standard 1576:1:2010 Scaffolding General Requirements
Cases:
- Veen v R (No 2) (1988) 164 CLR 465
- R v McNaughton (2006) 66 NSWLR 566
- Baumer v R (1988) 166 CLR 51
- BW v R [2011] NSWCCA 176
- R v Wilkinson (No 5) [2009] NSWSC 432
- R v Thomson & Houlton (2000) 49 NSWLR 383
- R v Borkowski (2009) 195 A Crim R 1
- Environmental Protection Agency v Barnes [2006] NSWCCA 246
- Capral Aluminium Limited v Workcover Authority of New South Wales (2000) 49 NSWLR 610
- Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37