Citation: SafeWork NSW v Austar Construction Pty Ltd [2023] NSWDC 289
Court: District Court of New South Wales
Date: 1 August 2023
Judge: Scotting DCJ
Background
Austar Construction Pty Ltd was the principal contractor for a residential construction project in Gladesville. The company employed four workers, including a site supervisor, and engaged a chain of subcontractors for electrical work: Stoney Contracting Pty Ltd, which in turn subcontracted to a sole trader electrician, Jingxin Gao.
On 15 June 2020, Mr Gao was working alone on the first-floor mezzanine level of the partially completed two-storey house. He fell from the mezzanine to the ground floor. No one witnessed the fall, and Mr Gao retained no memory of it. He suffered catastrophic injuries including traumatic brain injury, multiple fractures, and a carotid cavernous fistula, requiring emergency neurosurgery and a month-long hospital admission. As at February 2021, he had not returned to full-time work.
SafeWork NSW prosecuted Austar Construction for failing to comply with its primary duty of care under s 19(1) of the Work Health and Safety Act 2011 (NSW), thereby exposing Mr Gao to a risk of death or serious injury. The company pleaded guilty and appeared for sentence.
Legal Issues
- What was the appropriate objective seriousness of the offence, including the adequacy of the fall-prevention systems in place at the site?
- What weight should be given to aggravating and mitigating factors, including the offender's prior record, remorse, cooperation, and guilty plea?
- What discount applied to the penalty for the guilty plea?
- How should the offender's limited financial capacity to pay a fine affect the penalty, given the competing need for general deterrence?
Decision
Objective seriousness. The court found the offence carried significant objective gravity. The temporary timber handrail at the mezzanine edge was inadequate on multiple counts: it was fixed with nails in a withdrawal orientation (making detachment more likely if a load fell against it), the timber posts were oriented in the weaker direction, and there was a gap between the toe board and the top rail. The Work Health and Safety Management Plan and Safe Work Method Statement for the site both failed to address the specific risk of falls from the mezzanine edge inside the building. Mr Gao had received no site induction or toolbox talks addressing that risk.
Mitigating factors. The court accepted several mitigating factors. Austar had no prior convictions under work health and safety legislation. The sole director, Peter Xie, expressed genuine contrition on the company's behalf, and the court accepted that remorse as sincere. The company cooperated with SafeWork's investigation and was assessed as having good prospects for rehabilitation, having installed a compliant guardrail after the incident. A 25% discount applied to the penalty for the utilitarian value of the guilty plea, consistent with the principles in R v Thomson & Houlton and R v Borkowski.
Capacity to pay. The court considered the requirements of s 6 of the Fines Act 1996. The most recent financial accounts showed the company had almost no capacity to pay, and any fine at the otherwise-appropriate level risked rendering it insolvent. The court noted that the sole director had previously injected personal funds into the company and that the business had not ceased trading. It treated the capacity-to-pay question as a relevant but not decisive factor, consistent with Jahandideh v R, and reduced the fine accordingly while preserving its deterrent effect.
Penalty. The court assessed the base fine at $320,000 before discounts. After applying the 25% guilty plea discount and a further reduction for limited financial capacity, it imposed a final fine of $150,000. The court convicted the offender and ordered it to pay the prosecutor's costs.
Orders Made
- Austar Construction Pty Ltd was convicted.
- A fine of $150,000 was imposed (reduced from a pre-discount figure of $320,000 by 25% for the guilty plea and a further amount for limited capacity to pay).
- The offender was ordered to pay the prosecutor's costs as agreed or assessed.
- Pursuant to s 122(2) of the Fines Act 1996, 50% of the fine is to be paid to the prosecutor.
Key Takeaways
- The District Court confirmed that a principal contractor owes a primary duty of care under s 19(1) of the Work Health and Safety Act 2011 (NSW) that extends to subcontractors working on site, even where those subcontractors are engaged through an intermediate party.
- Inadequacy of fall-protection systems, including the technical deficiencies of a temporary handrail and the failure to address site-specific risks in safety documentation, contributed substantially to the court's assessment of objective seriousness.
- A guilty plea attracted a 25% discount on penalty, reflecting both its utilitarian value to the justice system and its evidentiary relevance to remorse.
- Under the Fines Act 1996, limited financial capacity is a relevant but not decisive consideration. A substantial fine may still be warranted by the gravity of the offence and the need for general deterrence, even where it risks insolvency for the offender.
- Cooperation with a SafeWork investigation, post-incident remediation, and demonstrated remorse are all recognised mitigating factors in Work Health and Safety Act prosecutions, capable of reducing the penalty imposed.
Legislation and Cases Referenced
Legislation
- Work Health and Safety Act 2011 (NSW), ss 19(1), 32
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 21A(3)(i), 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
- 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