Citation: SafeWork NSW v JPS Car Wash Management Pty Ltd; SafeWork NSW v SRS Star Management Pty Ltd; SafeWork NSW v Sarjeet Sidhu [2021] NSWDC 148
Court: District Court of New South Wales
Date: 30 April 2021
Judge: Strathdee DCJ
Background
Two companies, a management company that held the licence to operate a car wash franchise at Ashfield Mall (referred to here as the licence holder) and a second company engaged to run day-to-day operations and supply workers (referred to here as the operator), together ran a car wash business in the car park of a Sydney shopping centre. The sole director of the licence holder was actively involved in overseeing the business and is the individual defendant in these proceedings. The operator's sole director served as on-site manager six days a week.
On 13 April 2018, two casual car wash attendants were closing up the premises for the day when a container of Tyre Shine fell from a fridge in the staffroom and spilled. One of the workers used a commercial wet and dry vacuum cleaner to clean up the spill. The vacuum had already been used that day to clean up water and another chemical. When the worker restarted the vacuum with a changed nozzle near the spill, an explosion occurred and fire engulfed the room and caught on to his clothing. He sustained serious burns and was taken by ambulance to hospital.
SafeWork NSW prosecuted both companies and the individual director for failing to fulfil their duties under the Work Health and Safety Act 2011 (NSW), specifically for exposing workers to a risk of death or serious injury. All three defendants entered early guilty pleas.
Legal Issues
- Whether each defendant had breached their respective duties under the Work Health and Safety Act 2011 (NSW) by exposing workers to a risk of death or serious injury, contrary to section 32 of the Act.
- The objective seriousness of the offending and where on the spectrum of seriousness each offence fell.
- What mitigating and aggravating factors were relevant to each defendant's sentence.
- Whether the defendants had the financial capacity to pay significant fines.
- What penalty appropriately reflected general and specific deterrence, totality, and parity between the defendants.
Decision
The court accepted the guilty pleas and proceeded to sentence all three defendants. The offences arose from a series of failures: workers were not adequately trained in the hazards of the chemicals used at the worksite, there were no safe systems of work for handling chemical spills, the vacuum cleaner was used to clean up flammable chemicals despite being unsuitable for that purpose, and flammable chemicals were stored in proximity to food and appliances in the staffroom.
Strathdee DCJ assessed the offending as serious, noting that the risk of harm was foreseeable and that simple, available measures could have eliminated or significantly reduced it. The court found that the defendants had demonstrated limited remorse and had sought to attribute blame for the incident to the injured worker himself. The three defence witnesses were described as unimpressive, and the court found they appeared intent on deflecting personal culpability rather than giving candid evidence.
On financial capacity, the court rejected the defendants' claims that they could not afford substantial fines. The evidence showed that the individual director and the operator's director each held assets and businesses that appeared viable on paper, and the licence-holding company had not filed tax returns or paid tax since approximately 2016. The court acknowledged that payment might be difficult but held that the objective seriousness of the offences required that the penalties meaningfully reflect that gravity, both for specific and general deterrence.
Each corporate defendant received a base fine of $400,000, reduced by 25 per cent for the early guilty plea to $300,000 each. The individual director received a base fine of $40,000, similarly reduced by 25 per cent to $30,000. The maximum penalty for a corporate offender under section 32 of the Act is $1,500,000, and for an individual is $300,000.
Orders Made
- JPS Car Wash Management Pty Ltd convicted and fined $300,000 (base fine of $400,000, reduced by 25% for early guilty plea).
- SRS Star Management Pty Ltd convicted and fined $300,000 (base fine of $400,000, reduced by 25% for early guilty plea).
- Sarjeet Sidhu convicted and fined $30,000 (base fine of $40,000, reduced by 25% for early guilty plea).
- Pursuant to section 122(2) of the Fines Act 1996 (NSW), 50% of each fine is to be paid to the prosecutor.
- All defendants to pay the prosecutor's costs in the agreed sum of $40,000.
Key Takeaways
- The District Court confirmed that where multiple duty-holders operate a single worksite under a layered contractual arrangement (licensor, operator, and on-site manager), each entity with a duty under section 19(1) of the Work Health and Safety Act 2011 (NSW) can be prosecuted separately for the same failure to protect workers.
- A 25% discount on the base fine was applied to each defendant for entering an early guilty plea, consistent with established sentencing principles under the Crimes (Sentencing Procedure) Act 1999 (NSW).
- Where defendants claim financial incapacity to pay a fine, the court will scrutinise that claim carefully against the evidence of actual assets and business operations, and may reject it where the evidence does not adequately support the assertion.
- Attempts by defendants to attribute blame to an injured worker, rather than demonstrating genuine remorse, were treated by the court as an indicator of limited rehabilitation and weighed against them in the sentencing exercise.
- Under section 122(2) of the Fines Act 1996 (NSW), 50% of fines imposed in successful SafeWork NSW prosecutions are directed to the prosecutor, a procedural feature relevant to the administration of these matters.
Legislation and Cases Referenced
Legislation
- Work Health and Safety Act 2011 (NSW), ss 19(1), 27(1), 32
- Crimes (Sentencing Procedure) Act 1999 (NSW)
- Fines Act 1996 (NSW), s 122(2)
Cases
- Bulga Underground Operations v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338
- Capral Aluminium Limited v WorkCover Authority of NSW [2000] NSWIRComm 71; (2000) 49 NSWLR 610
- Fisher v Samaras Industries Pty Limited (1996) 82 IR 384
- Jahandideh v R [2014] NSWCCA 178
- Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (1999) 90 IR 464
- Markarian v The Queen (2005) 228 CLR 357
- McColl v John Watson Building Services Pty Ltd & Anor (2004) 137 IR 310
- Morrison v Powercoal Pty Limited & Anor (No.3) [2005] NSWIRComm 61
- Nash v Silver City Drilling (NSW) (2017) 93 NSWLR 338
- Orbit Drilling v The Queen (2012) 35 VR 399
- R v Cage [2006] NSWCCA 304
- R v MA [2004] NSWCCA 92
- R v Miria [2009] NSWCCA 68
- R v MMK [2006] NSWCCA 272
- R v Skondin [2015] QCA 138
- SafeWork NSW v Grandcity Constructions Pty Ltd [2018] NSWDC 398
- SafeWork NSW v HCM Building Pty Limited [2019] NSWDC 632
- SafeWork NSW v McConnell Dowell Constructors (Aust) Pty Limited (No 2) [2020] NSWDC 668
- SafeWork v Poletti Corporation [2019] NSWDC 491
- Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266