Citation: SafeWork NSW v Millart Enterprises and Notlad Enterprises [2018] NSWDC 52
Court: District Court of New South Wales
Date: 19 March 2018
Judge(s): Scotting DCJ
Background
Two companies, Millart Enterprises Pty Ltd and Notlad Enterprises Pty Ltd, operated a dive and snorkelling tour business in partnership trading as Byron Bay Dive Centre. Each company was directed by one of the two business partners. The business offered drift snorkelling tours at Julian Rocks, approximately 2.5 kilometres off the Byron Bay coast.
On 8 April 2015, a customer, Ms Teresa Swarbrick, joined a drift snorkelling tour. Ms Swarbrick had disclosed several medical conditions on a pre-tour risk identification form, including breathlessness and heart disease. The employee who processed the form did not pass this information on to the vessel captain, contrary to the business's own Safety Management System. Ms Swarbrick was not prevented from participating, and no additional supervision or flotation device was required.
During the tour, Ms Swarbrick and her husband were caught in a hazardous current. She struggled against it, became breathless, and ultimately lost consciousness in the water. She did not survive. Both companies pleaded guilty to failing to comply with their health and safety duty under the Work Health and Safety Act 2011, thereby exposing Ms Swarbrick to a risk of death or serious injury.
Legal Issues
- What was the objective seriousness of the offences under section 32 of the Work Health and Safety Act 2011?
- What weight should be given to mitigating factors, including guilty pleas, cooperation with the regulator, prior good character, and the personal toll on the individuals behind the companies?
- What was the appropriate fine for each company, having regard to the maximum penalty of $1.5 million per offence?
- Did either company have a limited capacity to pay that would justify reducing the fine?
Decision
Scotting DCJ assessed the objective seriousness of the offending as falling within the low to moderate range. Several safety failures were identified: the failure to pass on Ms Swarbrick's medical information to the vessel captain, the failure to impose additional control measures such as closer supervision or a personal flotation device, and procedural deficiencies in the risk identification process. However, the Court noted that substantial briefings were given to participants, standard safety equipment was carried, and that the current conditions had been assessed as safe before entry.
On mitigating factors, the Court accepted that both companies had no prior convictions, had taken steps to improve their safety systems after the incident, and had cooperated with the SafeWork NSW investigation. The companies also expressed genuine remorse and contrition. The personal impact of the tragedy on the two directors was taken into account, though the Court noted that the companies themselves were the offenders.
A 25 per cent discount on penalty was applied to reflect the utilitarian value of the early guilty pleas, consistent with the principles in R v Thomson and Houlton and R v Borkowski. The Court found the evidence insufficient to establish that either company had a limited capacity to pay, noting that capacity is relevant but not decisive under the Fines Act 1996. Because both companies occupied equal positions in the partnership and the offending was substantively the same, identical penalties were imposed on each.
Orders Made
- Millart Enterprises Pty Ltd convicted and fined $60,000 (reduced from a starting point of $80,000 by a 25% guilty plea discount).
- Notlad Enterprises Pty Ltd convicted and fined $60,000 (reduced from a starting point of $80,000 by a 25% guilty plea discount).
- Fifty per cent of each fine to be paid to the prosecutor pursuant to section 122(2) of the Fines Act 1996.
- Each company ordered to pay the prosecutor's costs as agreed or assessed.
Key Takeaways
- Under section 32 of the Work Health and Safety Act 2011, a person conducting a business who fails to comply with a health and safety duty and thereby exposes another person to a risk of death or serious injury faces a maximum fine of $1.5 million per offence.
- The District Court treated the offending as low to moderate in objective seriousness, weighing identified safety failures against evidence of genuine briefing procedures, standard equipment, and a reasonable pre-entry assessment of conditions.
- A 25 per cent discount applied where both companies entered early guilty pleas, reflecting the utilitarian value of those pleas and the remorse they indicated.
- Where an offender seeks a reduction in fine on the basis of limited capacity to pay, the evidentiary onus rests on the offender to demonstrate that capacity limitation. Insufficient financial evidence led the Court to decline any such reduction here.
- Equal culpability between two business partners operating under an equal partnership structure supported the imposition of identical penalties, even where minor factual differences existed between their respective roles.
Legislation and Cases Referenced
Legislation:
- Work Health and Safety Act 2011 (NSW), ss 19(2), 32
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 21A(3)(k), 21A(3)(m), 22
- Fines Act 1996 (NSW), ss 6, 122(2)
Cases:
- Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37
- R v Youkhana [2004] NSWCCA 412
- R v Thompson and Houlton (2000) 49 NSWLR 383
- R v Borkowski (2009) 195 A Crim R 1
- Jahandideh v R [2014] NSWCCA 178
- E v Borowski (2009) 195 A Crim R 1