Citation: SafeWork NSW v South Coast Under Road Borers Pty Ltd [2021] NSWDC 314
Court: District Court of New South Wales
Date: 14 July 2021
Judge(s): Scotting DCJ
Background
South Coast Under Road Borers Pty Ltd is a small specialist contractor providing underground directional drilling, vacuum extraction, and trenching services in the construction industry. The company operated a fleet of trucks and equipment from its premises at Termeil, NSW. Its sole director managed administration and safety compliance, while a senior manager oversaw day-to-day operations and on-site work.
On 23 October 2017, 27-year-old mechanic Reece Marchello was working alone underneath a 26-tonne Hino vacuum truck parked on uneven, soft, sloping ground adjacent to an on-site dam. The truck had a faulty hydraulic hose and a worn universal joint, and the crew had been carrying out repairs. After the crew leader left the premises without informing other workers, Mr Marchello continued working beneath the truck unattended. The truck rolled and crushed him. He died from his injuries.
SafeWork NSW prosecuted the company under the Work Health and Safety Act 2011 (the Act) for failing to comply with its primary health and safety duty. The company pleaded guilty. The proceedings before Scotting DCJ concerned the appropriate sentence.
Legal Issues
- Whether the company breached its primary duty under s 19(1) of the Work Health and Safety Act 2011 by exposing workers to a risk of death or serious injury (conceded by plea)
- The objective seriousness of the offence for sentencing purposes
- The weight to be given to mitigating factors, including the guilty plea, remorse, prior good record, and prospects of rehabilitation
- Whether the company had a reduced capacity to pay a fine
- The appropriate penalty, having regard to both specific and general deterrence
Decision
The company pleaded guilty to a Category 2 offence under s 32 of the Act, carrying a maximum fine of $1.5 million. The court assessed the objective seriousness of the offence. The risk of harm was obvious: the truck was parked on soft, sloping ground near a dam, the wheels were not chocked, flat ground was available elsewhere, and workers were required to be underneath the truck to carry out repairs. The court found the offence was of moderate to high objective seriousness.
Several systemic failures contributed to the incident. The company had no safe work method statement (SWMS) specifically covering work underneath vehicles. There was no protocol requiring wheels to be chocked before undercarriage work commenced. The crew leader's departure without informing other workers, combined with the absence of any supervision system, left Mr Marchello exposed to an obvious and foreseeable hazard entirely without oversight.
On mitigation, the court accepted that the company had no prior convictions, expressed genuine remorse, and had cooperated with the investigation. Post-incident, the company introduced improved safety procedures. The court acknowledged that the death had also profoundly affected the company's principals. These factors were weighed in the company's favour, as was the utilitarian value of the early guilty plea, which attracted a 25% discount.
The court rejected the company's submission that it had a reduced capacity to pay. Reviewing financial accounts, the court observed that when depreciation (including instant write-offs under tax concessions for new plant acquisitions) was added back, the company was trading at approximately $220,000 profit in 2020. The company also failed to provide current valuations of its premises, plant, campervans, and fishing boat.
Orders Made
- South Coast Under Road Borers Pty Ltd convicted of the offence under s 32 of the Work Health and Safety Act 2011
- Fine of $500,000 reduced by 25% for the guilty plea, resulting in a fine of $375,000
- The offender to pay the prosecutor's costs of the proceedings, as agreed or assessed
- Pursuant to s 122(2) of the Fines Act 1996, 50% of the fine to be paid to the prosecutor (SafeWork NSW)
Key Takeaways
- The District Court assessed an unguarded risk of a 26-tonne truck rolling onto a worker performing undercarriage repairs, on sloping soft ground without wheel chocks, as an offence of moderate to high objective seriousness under the Work Health and Safety Act 2011.
- Absence of a specific SWMS for work under vehicles, and the lack of any system ensuring workers were supervised or informed when a crew leader departed, were central to the court's assessment of systemic failure.
- A 25% guilty plea discount applied in line with established sentencing principles, reducing a $500,000 base fine to $375,000 against a $1.5 million maximum.
- Where a defendant company claims reduced capacity to pay a fine, the court will look beyond headline profit and loss figures: depreciation entries (particularly tax-concession instant write-offs of new plant) may be added back, and the absence of asset valuations will weigh against the submission.
- Victim impact statements from six family members were received and considered as evidence of harm to the community, forming part of the sentencing calculus even though they do not directly affect the determination of the fine quantum under the Act.
Legislation and Cases Referenced
Legislation
- Work Health and Safety Act 2011 (NSW), ss 19(1), 32
- Work Health and Safety Regulation 2017 (NSW)
- Crimes (Sentencing Procedure) Act 1999 (NSW)
- Fines Act 1996 (NSW), s 122(2)
Cases
- Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37
- Jahandideh v R [2014] NSWCCA 178
- R v Borkowski (2009) 195 A Crim R 1
- R v Thomson & Houlton (2000) 49 NSWLR 383
- R v Youkhana [2004] NSWCCA 412