Citation: SafeWork NSW v Cincram Group Pty Ltd [2022] NSWDC 613
Court: District Court of New South Wales
Date: 9 December 2022
Judge: Russell SC DCJ
Background
Cincram Group Pty Ltd operated a warehouse in Newington, NSW, and imported palletised copper cable from Singapore. Since 2013, consignments arrived in shipping containers loaded onto standard skeleton trailers, delivered at an elevated height. The company had chosen this delivery method over safer alternatives, such as side-loader trucks that could place containers on the ground, when those options were offered by its freight forwarder.
On 20 November 2019, a worker, Mr Chan Hu, was inside an elevated shipping container using a pallet jack to move heavy stacks of copper cable pallets. Each pallet weighed approximately 500 kg and the pallets were double-stacked. While Mr Hu was manoeuvring the pallet jack, the upper pallet shifted and pinned him against the load guard of a forklift positioned at the container entrance. The forklift was moved to free him, and he fell from the elevated container onto the concrete ground below, suffering serious injuries.
Cincram pleaded guilty to failing to comply with its primary duty of care under section 19 of the Work Health and Safety Act 2011 (NSW), thereby exposing Mr Hu to a risk of death or serious injury, contrary to section 32 of that Act. The maximum penalty for this category of offence is a fine of $1,500,000.
Legal Issues
- What was the appropriate starting fine, having regard to the objective seriousness of the offence?
- What discount, if any, should apply for the early guilty plea?
- Whether Cincram had discharged its evidentiary burden to demonstrate a reduced capacity to pay, and whether any reduction in penalty was warranted on that basis?
- What was the appropriate order for prosecution costs?
Decision
The court assessed the objective seriousness of the offence as significant. Cincram had chosen the least safe delivery method despite being offered safer alternatives, used a pallet jack inside an elevated container with heavily loaded double-stacked pallets, and lifted double-stacked loads that exceeded the forklift's rated capacity of 690 kg. There was no documented safe system of work for unpacking containers, and no adequate training or instruction had been provided.
The court identified an absence of reasonably practicable measures that could have eliminated or minimised the risk. These included requiring delivery on side-loader trucks or flatbed trucks, prohibiting use of pallet jacks inside elevated containers, and developing written safe work procedures for container unpacking. The failings were systemic rather than isolated.
On penalty, the court determined that an appropriate fine before any discount was $500,000. A 25% reduction was applied to reflect the early plea of guilty, bringing the figure to $375,000. The court noted mitigating factors including the guilty plea, the absence of prior convictions, and cooperation with investigators.
On the capacity-to-pay question, the court found that Cincram had failed to discharge its evidentiary burden. Affidavits filed on behalf of the company presented an incomplete picture of its finances, omitting a $1,300,000 business sale that had already been completed. This only came to light through material tendered by the prosecutor. The court refused a late adjournment application to file further affidavit evidence, noting that Practice Note 16 required all financial affidavits to be filed four weeks before the sentence hearing. Accordingly, no reduction for reduced capacity to pay was granted.
Orders Made
- Cincram Group Pty Ltd convicted.
- Cincram Group Pty Ltd ordered to pay a fine of $375,000 (starting point of $500,000, reduced by 25% for early guilty plea).
- Pursuant to section 122(2) of the Fines Act 1996 (NSW), 50% of the fine to be paid to the prosecutor (SafeWork NSW).
- Cincram Group Pty Ltd ordered to pay the prosecutor's costs in the agreed amount of $47,500.
Key Takeaways
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A defendant in WHS sentencing proceedings who relies on reduced capacity to pay bears an evidentiary burden to provide a complete and accurate picture of its financial position. Selective or incomplete financial disclosure will not satisfy that burden, and the court will decline to reduce the penalty accordingly.
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Where safer delivery and unpacking methods were available and had been offered to a business, choosing a more hazardous alternative weighs toward greater objective seriousness at sentencing.
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Under section 32 of the Work Health and Safety Act 2011 (NSW), a failure to implement reasonably practicable measures, including safe systems of work, adequate training, and appropriate plant selection, can each independently ground a finding of breach of the primary duty.
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An early guilty plea remained a meaningful mitigating factor, attracting a 25% reduction from the starting fine, consistent with established sentencing principles under the Crimes (Sentencing Procedure) Act 1999 (NSW).
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Courts sentencing corporate defendants in WHS matters will take account of business size in calibrating the deterrent effect of a fine, but a corporation that withholds material financial information loses the benefit of any capacity-to-pay argument.
Legislation and Cases Referenced
Legislation
- Work Health and Safety Act 2011 (NSW), ss 3, 19, 32
- 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
- SafeWork NSW v Meixing Jiang [2018] NSWDC 400
- Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266
- Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465