Citation: Nash v Silver City Drilling (NSW) Pty Ltd; Attorney General for New South Wales v Silver City Drilling (NSW) Pty Ltd [2017] NSWCCA 96
Court: NSW Court of Criminal Appeal
Date: 16 May 2017
Judges: Basten JA; Hoeben CJ at CL; Walton J
Background
An employee of the respondent drilling company suffered life-threatening spinal injuries resulting in quadriplegia during operations at the Ashton Coal Mine near Singleton on 12 August 2012. The incident occurred when a discharge pipe (known as a "blooie line") was inadequately secured, causing it to be driven upward under the pressure of large quantities of water and slurry being expelled from the borehole. The operator standing on the adjacent platform was struck and critically injured.
A WorkSafe inspector charged the respondent company with a Category 2 offence under s 32 of the Work Health and Safety Act 2011 (NSW), for failing to comply with its primary duty of care under s 19(1) of that Act. The company pleaded guilty and was sentenced in the District Court in August 2016 to a fine of $112,000, which represented a substantial reduction from the maximum penalty of $1.5 million applicable to corporations for Category 2 offences. The sentencing judge also awarded the prosecutor a moiety (half) of the fine but declined to order the company to pay the prosecutor's costs.
Two appeals followed: one by the Attorney General against the adequacy of the sentence under s 5D of the Criminal Appeal Act 1912 (NSW), and a separate appeal against the refusal to award costs under s 257B of the Criminal Procedure Act 1986 (NSW).
Legal Issues
- Whether the sentencing judge erred in assessing the objective seriousness of the offence
- Whether the judge gave insufficient weight to general and specific deterrence
- Whether the 25% guilty plea discount (incorporating cooperation) was appropriate in the circumstances
- Whether the fine of $112,000 was manifestly inadequate given the maximum penalty of $1.5 million
- Whether the award of a moiety of the fine to the prosecutor under s 122(2) of the Fines Act 1996 (NSW) displaced or precluded an order for the prosecutor's costs under s 257B of the Criminal Procedure Act 1986 (NSW)
Decision
The Court of Criminal Appeal found multiple errors in the sentencing judge's approach. The sentencing court had assessed the offence as being below mid-range in objective seriousness, a finding the Court of Criminal Appeal considered was not adequately supported. The risk materialised and caused catastrophic harm, the hazard was known or ought to have been known, and practical steps to address it had not been taken. The Court also found that the sentencing judge had given insufficient weight to deterrence, which carries particular importance in workplace health and safety prosecutions.
On the plea discount, the sentencing judge had initially stated a discount of 25% but then appeared to conflate that with credit for cooperation. The Court of Criminal Appeal found this conflation to be an error. Under the principles in R v Thomson; R v Houlton, a guilty plea entered at the earliest opportunity may attract a discount of up to 25%, but that discount should not be further enlarged by folding in cooperation-related considerations as though they were part of the same exercise.
On resentencing, the Court applied a starting point reflecting a higher assessment of objective seriousness and appropriate deterrence, then applied a 25% plea discount. The resulting fine was set at $212,500, replacing the original $112,000.
On costs, the Court held that the award of a moiety of the fine to the prosecutor does not preclude a separate order for costs under s 257B of the Criminal Procedure Act 1986 (NSW). The moiety is a statutory entitlement tied to the fine; it is not a costs order and does not serve the same function. The sentencing judge had erred in treating the moiety as a reason to decline costs. The Court allowed the costs appeal and ordered the respondent to pay the prosecutor's District Court costs, excluding costs referable to particulars that had been withdrawn from the amended summons.
Orders Made
On the sentence appeal:
- Appeal allowed; orders of Curtis DCJ set aside
- Respondent convicted of an offence under s 32 of the Work Health and Safety Act 2011 (NSW) for contravening s 19(1) at Ashton Coal Mine on 12 August 2012
- Respondent ordered to pay a fine of $212,500, of which a moiety is payable to the prosecutor
On the costs appeal:
- Appeal allowed; order of Curtis DCJ refusing costs set aside
- Respondent ordered to pay the prosecutor's costs of the District Court proceedings, excluding costs incurred in preparation for trial on particulars later withdrawn, with costs to be agreed or assessed
Key Takeaways
- The Court of Criminal Appeal confirmed that workplace health and safety sentencing must give significant weight to general deterrence, particularly where the hazard was known (or ought to have been known) and the risk ultimately materialised with severe consequences.
- A 25% guilty plea discount for a plea entered at the earliest opportunity is the recognised ceiling under the Thomson/Houlton principles; cooperation with authorities is a distinct mitigating factor and should not be bundled into that discount figure without separate analysis.
- Under s 122(2) of the Fines Act 1996 (NSW), the award of a moiety of a fine to a prosecutor is a statutory entitlement, not a costs order, and does not displace or preclude a separate exercise of the costs discretion under s 257B of the Criminal Procedure Act 1986 (NSW).
- Objective seriousness must be assessed with reference to the actual risk created, the foreseeability of that risk, the degree of harm that resulted, and the practicability of precautions, not simply by comparison to the worst-case category of offending.
- A fine of $112,000 against a maximum of $1.5 million was held to be manifestly inadequate in circumstances involving a foreseeable, preventable risk that caused permanent and catastrophic injury to a worker.
Legislation and Cases Referenced
Legislation:
- Work Health and Safety Act 2011 (NSW), ss 18, 19, 30, 31, 32
- Criminal Appeal Act 1912 (NSW), s 5D
- Criminal Procedure Act 1986 (NSW), s 257B
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 4, 21A, 22
- Fines Act 1996 (NSW), ss 6, 122
- Crimes (Appeal and Review) Act 2001 (NSW), s 68A
Cases:
- Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37
- CMB v Attorney General (NSW) (2015) 256 CLR 346; [2015] HCA 9
- Downey v Acting District Court Judge Boulton (No 5) (2010) 78 NSWLR 499; [2010] NSWCA 240
- Latoudis v Casey (1990) 170 CLR 534
- Mulato v R [2006] NSWCCA 282
- R v KB, JL and RJB [2011] NSWCCA 190
- R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309
- Slivak v Lurgi (Australia) Pty Ltd (2001) 205 CLR 304; [2001] HCA 6
- Hamdorf v Riddle [1971] SASR 398