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District Court 28 November 2024

SafeWork NSW v Form Group NSW Pty Ltd

[2024] NSWDC 562

Other
CRIMINAL LAW PROSECUTION WORK HEALTH AND SAFETY DUTY OF PERSONS UNDERTAKING BUSINESS RISK OF DEATH OR SERIOUS INJURY MAXIMUM PENALTY SENTENCE

Citation: SafeWork NSW v Form Group NSW Pty Ltd [2024] NSWDC 562
Court: District Court of New South Wales
Date: 28 November 2024
Judge: Strathdee DCJ

Background

The defendant, Form Group NSW Pty Ltd, was a formwork subcontractor engaged on a residential construction project at Edmundson Park, NSW. The defendant directed workers, including a 58-year-old labourer employed by a further subcontractor, to carry out Dincel wall installation in a laneway between three buildings under construction.

On 24 August 2020, a crane operator and dogman commenced lifting a two-to-four-tonne bundle of steel reinforcement bars approximately two metres from ground level. The dogman did not see the labourer standing in the laneway before directing the lift to begin. The crane operator lost control of the load, which swung in a pendulum motion and struck the labourer on his right side, lifting him off the ground and pinning him to formwork for up to 60 seconds.

The labourer sustained multiple rib fractures, a torn rotator cuff requiring surgery, haematuria, and a lower back injury. As at May 2021 he remained unfit to return to work in any capacity. SafeWork NSW prosecuted the defendant as a person conducting a business or undertaking (PCBU) under the Work Health and Safety Act 2011 (NSW) for failing to ensure the health and safety of workers, exposing the labourer to a risk of serious injury.

  • Whether the defendant, as a PCBU, failed to comply with its duty under s 19(1) of the WHS Act to ensure, so far as reasonably practicable, the health and safety of workers at work in its undertaking
  • The objective seriousness of the offence under s 32 of the WHS Act
  • The appropriate discount for a guilty plea entered after the matter was listed for trial
  • The relevance of the defendant's financial position and capacity to pay when fixing the fine
  • Whether the court should exercise its discretion under s 6 of the Fines Act 1996 (NSW) to reduce the fine further
  • The appropriate order for prosecutor's costs

Decision

The defendant pleaded guilty on 20 March 2024, after the matter had been listed for a two-week trial commencing 8 April 2024. The court treated this late plea as carrying a more limited discount than an early plea would attract, reflecting the reduced utility to the prosecution and the court system at that stage.

Strathdee DCJ assessed the objective seriousness of the offending in the context of the maximum penalty under s 32 of the WHS Act. The court identified the risk of death or serious injury from crane lifts in a shared worksite laneway as substantial, and found the defendant's failures included inadequate supervision and coordination with other duty holders in a multi-contractor environment. The court noted the absence of a proper exclusion zone during the lift and the lack of adequate communication with workers, including the labourer who spoke only Bengali and had limited English.

On the question of financial capacity, the court accepted evidence that the defendant had experienced a significant decline in turnover, that the construction industry had been adversely affected by post-COVID supply chain disruption and inflation, and that the defendant was operating at a loss. The court found that a large fine risked the defendant's insolvency and potential loss of employment for its workers. Applying s 6 of the Fines Act, the court exercised its discretion to reduce the fine by a further 20% after the plea discount was applied.

The court also confirmed that prosecutor's costs are the normal outcome where the prosecution succeeds, consistent with the compensatory (not punitive) function of cost orders established in Latoudis v Casey. The court took into account both the prosecutor's costs liability and the defendant's own legal costs when fixing the monetary penalty.

Orders Made

  • The defendant is convicted.
  • The base fine of $300,000 was reduced by 25% for the guilty plea to $225,000.
  • A further 20% reduction was applied under s 6 of the Fines Act 1996 (NSW).
  • The defendant is ordered to pay a fine of $180,000.
  • Pursuant to s 122(2) of the Fines Act 1996 (NSW), 50% of the fine is to be paid to the prosecutor.
  • The defendant is to pay the prosecutor's costs, as agreed or assessed (s 257B of the Criminal Procedure Act 1986 (NSW)).

Key Takeaways

  • A PCBU operating as a formwork subcontractor on a multi-contractor site was held liable under s 32 of the WHS Act for failing to ensure workers in its undertaking were not exposed to the risk posed by an unsecured crane lift zone, even where the crane services were provided by a separate contractor.
  • Under s 6 of the Fines Act 1996 (NSW), a court may exercise discretion to reduce a WHS fine where there is credible evidence that the defendant lacks capacity to pay and that a large fine would threaten the business's survival, though general deterrence remains a weighty consideration.
  • A guilty plea entered only weeks before a two-week trial attracts a materially lower discount than an early plea; the 25% reduction applied here reflects the limited utility of a late plea to the prosecution and the court.
  • Prosecutor's costs in WHS proceedings follow the normal rule that a successful prosecutor is entitled to costs, as cost orders serve a compensatory rather than punitive function (Latoudis v Casey (1990) 170 CLR 534).
  • The presence of workers with limited English proficiency, the absence of a proper exclusion zone during the crane lift, and inadequate coordination between duty holders in a shared worksite were all relevant to the court's assessment of the seriousness of the offending.

Legislation and Cases Referenced

Legislation
- Work Health and Safety Act 2011 (NSW), ss 3, 19(1), 31, 32, 46
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 22
- Criminal Procedure Act 1986 (NSW), s 257B
- Fines Act 1996 (NSW), ss 6, 122

Cases
- Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534
- Bulga Underground Operations Pty Ltd v Nash (2016) 93 NSWLR 338; [2016] NSWCCA 37
- Environmental Protection Authority v Barnes [2006] NSWCCA 246
- Muldrock v The Queen (2011) 244 CLR 120; [2011] HCA 39
- Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25
- Nash v Silver City Drilling (NSW) Pty Ltd; Attorney General for New South Wales v Silver City Drilling (NSW) Pty Ltd [2017] NSWCCA 96
- Capral Aluminium Ltd v WorkCover Authority (NSW) (2000) 49 NSWLR 610; [2000] NSWIRComm 71
- Morrison v Powercoal Pty Ltd (No 3) (2005) 147 IR 117; [2005] NSWIRComm 61
- Orbit Drilling Pty Ltd v The Queen (2012) 35 VR 399; [2012] VSCA 82
- Lawrenson Diecasting Pty Ltd v WorkCover Authority (NSW) (1999) 90 IR 464
- Ferguson v Nelmac Pty Ltd (1999) 92 IR 188
- McColl v John Watson Building Services Pty Ltd (2004) 137 IR 310; [2004] NSWIRComm 353