Citation: SafeWork NSW v Candal Investments Pty Ltd [2021] NSWDC 139
Court: District Court of New South Wales
Date: 29 April 2021
Judge: Russell SC DCJ
Background
The defendant company operated a meat processing and packaging factory in Bomaderry, NSW. As part of a trial to prepare export-quality vacuum-sealed meat products, the company connected a third-party gas system (the Superfresh System) to an existing vacuum-sealing machine (the Reepack Machine). The gas system included a pressure regulator configured to deliver a maximum outlet pressure of 200 bar, far exceeding the 31 bar burst pressure of a downstream plastic filter housing.
On 28 May 2018, a meat packer heard a hissing sound while using the system. As she attempted to turn off the gas, the system reached its bursting limit and exploded. Fragments of the plastic filter housing entered her right forearm, causing a deep laceration injury.
The defendant pleaded guilty to a charge under ss 19 and 32 of the Work Health and Safety Act 2011 (NSW): as a person conducting a business or undertaking, it failed to comply with its primary duty to ensure the health and safety of workers, thereby exposing the worker to a risk of death or serious injury. The maximum penalty for the offence is a fine of $1,500,000.
Legal Issues
- What was the objective seriousness of the offence, having regard to the nature and circumstances of the safety failures?
- What weight should be given to mitigating factors, including the guilty plea, absence of prior convictions, and post-incident remediation?
- What effect did the defendant's reduced financial capacity have on the appropriate fine?
- What was the appropriate penalty, including the mandatory 25% reduction for a guilty plea?
Decision
The court assessed the objective seriousness of the offence by reference to the multiple, concurrent safety failures identified in the particulars. These included: no risk assessment before connecting the new gas system components; installation of a regulator whose maximum outlet pressure far exceeded the burst pressure of downstream components; absence of a properly sized pressure relief valve; gaps in the standard operating procedure; and inadequate training for workers operating the system. The risk created was one capable of causing death or serious injury, and the worker did suffer a significant physical injury.
In considering subjective factors, the court noted the defendant's guilty plea (attracting the 25% discount), its cooperation with investigators, the steps taken to remediate the workplace after the incident, its lack of prior convictions, and its expressions of remorse. These factors moderated the penalty downward from the starting point the court would otherwise have fixed.
The court also took into account the defendant's reduced financial capacity, which had been affected by drought, the COVID-19 pandemic, and the loss of the Chinese export market following trade sanctions. Both parties accepted the company had a reduced, though not absent, capacity to pay. The court moderated the fine accordingly. General deterrence remained an important sentencing consideration, given the nature of work health and safety offences and the need to encourage compliance across similar industries.
Applying the 25% guilty plea discount to a pre-discount fine of $80,000, the court imposed a final fine of $60,000. It also ordered that 50% of the fine be paid to the prosecutor, as provided by the Fines Act 1996 (NSW).
Orders Made
- Candal Investments Pty Ltd convicted of the offence.
- Fined $60,000 (reflecting a 25% reduction from $80,000 for the guilty plea).
- 50% of the fine to be paid to the prosecutor, pursuant to s 122(2) of the Fines Act 1996 (NSW).
- Defendant to pay the prosecutor's agreed costs of $37,000.
Key Takeaways
- The District Court confirmed that multiple concurrent safety failures, including the absence of a risk assessment, incompatible pressure components, no pressure relief valve, and training gaps, collectively informed the objective seriousness of a WHS offence, even where no single failure was characterised as egregious in isolation.
- A guilty plea attracted the standard 25% discount under the Crimes (Sentencing Procedure) Act 1999 (NSW), reducing the fine from $80,000 to $60,000.
- Where a defendant demonstrates reduced financial capacity caused by external economic factors (including a pandemic and trade disruption), the sentencing court may moderate the fine it would otherwise impose, provided the defendant does not claim total inability to pay.
- General deterrence retained significant weight in the sentencing exercise, consistent with the broader purposes of work health and safety legislation to promote safe systems of work across industry.
- Connecting new process equipment to an existing machine without verifying component compatibility or conducting a risk assessment was treated as a serious failure of the primary duty owed to workers under s 19 of the Work Health and Safety Act 2011 (NSW).
Legislation and Cases Referenced
Legislation:
- Work Health and Safety Act 2011 (NSW), ss 3, 19, 32, 195, 274
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 22
- Fines Act 1996 (NSW), ss 6, 122
Cases:
- Baumer v R [1988] HCA 67; (1988) 166 CLR 51
- Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338
- BW v R [2011] NSWCCA 176
- Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610
- Mahdi Jahandideh v The Queen [2014] NSWCCA 178
- Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120
- Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96
- R v McNaughton [2006] NSWCCA 242; (2006) 66 NSWLR 566
- R v Wilkinson (No. 5) [2009] NSWSC 432
- Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266
- Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465