Inspector Ken Kumar v Keralex Pty Limited (In Administration) [2005] NSWIRComm 199 (23 June 2005)

Last Updated: 24 June 2005

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION : Inspector Ken Kumar v Keralex Pty Limited (In Administration) [2005] NSWIRComm 199

FILE NUMBER(S): 5367 and 5368

HEARING DATE(S): 06/12/2004

DECISION DATE: 23/06/2005

PARTIES:

Prosecutor

Inspector Ken Kumar

Defendant

Keralex Pty Limited (In Administration) (ACN 011 070 170)

JUDGMENT OF: Backman J

LEGAL REPRESENTATIVES

Prosecutor

Mr R. Reitano, of counsel

Solicitor

Criminal Law Practice, Legal Group

WorkCover Authority of New South Wales

Defendant

No appearance

CASES CITED: Capral Aluminium Limited v WorkCover Authority of New South Wales (Inspector Mayo-Ramsay) (2000) 49 NSWLR 610; 99 IR 29

Commissioner of Taxation (Cth) v Australia and New Zealand Bank Group Pty Ltd (1979) 143 CLR 499

Inspector Gabrielle Belley v Rail Infrastructure Corporation [2001] NSWIRComm 323

Inspector Jones v T Helsby & Sons Contracting Pty Ltd (No 2) [2004] NSWIRComm 57

Inspector Maltby v Josef and Sons Pty Ltd [2003] NSWIRComm 336

Inspector Paul Kenneth Wade v Ken Mathews Haulier Pty Limited t/as Ken Mathews Landscaping Supplies [2005] NSWIRComm 85

McMillan Britton and Kell Pty Limited v WorkCover of New South Wales (Inspector Blake) (1999) 89 IR 464

Morrison v Powercoal Pty Ltd & Anor (No 3) [2005] NSWIRComm 61

Rodney Dale Morrison v Eureka Opal Pty Limited [2005] NSWIRComm 80

Rodney Morrison v Akula Pty Limited formerly known as Raise Bore Australia Pty Ltd [2004] NSWIRComm 41

WorkCover Authority of New South Wales (Inspector Ankucic) v McDonalds Australia Limited and Another (1999) 95 IR 383

WorkCover Authority of New South Wales (Inspector Buggy) v Newcastle Rail Corporation [2001] NSWIRComm 251

WorkCover Authority of New South Wales v Kirk Group Holdings Pty Limited (2004) 135 IR 166

WorkCover Authority of New South Wales v McDonald's Australia Limited and Another (1995) 95 IR 383

LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999

Occupational Health and Safety Act 1983

Occupational Health and Safety Act 2000

Workers Compensation Act 1987

JUDGMENT:

- 28 -

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

IN COURT SESSION

CORAM: Backman J

Thursday, 23 June, 2005.

Matter Nos IRC 5367 and 5368 of 2003

Inspector Ken Kumar v Keralex Pty Limited (In Administration)

Prosecutions under sections 8(2) and 10(1) of the Occupational Health & Safety Act, 2000

JUDGMENT

[2005] NSWIRComm 199

Introduction

1 Keralex Pty Limited (In Administration) ("the defendant") has been charged with one offence under s8(2) (No IRC 5368 of 2003) and a second offence under s10(1) (No IRC 5367 of 2003) of the Occupational Health & Safety Act, 2000 ("the 2000 Act").

2 The offence under s8(2) of the Act alleges a failure as an employer at 16 Childs Road, Chipping Norton on 26 September 2001 to ensure that people (other than employees of the defendant), in particular Maxwell Cook, were not exposed to risks to their health or safety arising from the conduct of its undertaking while they were at its place of work.

3 The offence under s8(2) has been particularised in the Application for Order in the following way:

"(a) The Defendant, at all material times, was a corporation responsible for the operation and management of a warehouse facility for the general cartage, storage and distribution of steel and ceramic products located at 16 Childs Road, Chipping Norton, in the State of New South Wales ("the premises").

(b) Top Container Transport Pty Ltd [ACN NO: 092 794 959], ("Top Container") at all material times, employed a number of workers, including Maxwell Cook ("Cook"), to work at the premises.

(c) The Defendant, at all material times operated plant, namely a Daewoo forklift truck, model no 252-2 and serial no 11-00412 ("the forklift"), at the premises.

(d) On 26 September 2001, as part of his duties, Cook used the forklift to stack steel crates containing stainless steel welded pipes ("the crates"). The crates were constructed of steel and were approximately 6200mm long, 600mm wide and 570mm high. The weight of a fully laden crate was approximately 1400kg.

(e) The defendant failed to ensure that people (other than the employees of the Defendant), in particular Cook, were not exposed to risks to their health or safety arising from the conduct of the Defendant's undertaking while they were at the Defendant's place of work, by:

(i) failing to provide safe systems of work in that the Defendant:

(i) failed to undertake a risk assessment that identified the maximum number of crates that could be safely stacked to ensure stability;

(ii) failed to provide and maintain a system of work that ensured people (other than employees of the Defendant) were not exposed to the risk of the crates falling on the person.

(ii) failing to provide such training and supervision as was necessary to ensure the safety of all people (other than the employees of the Defendant), in that the Defendant:

(i) failed to supervise people (other than the employees of the Defendant), in particular, to ensure the crates were stacked in a manner that was safe and without risk of injury;

(ii) failed to train supervisors in the identification of risks associated with the stacking of crates.

(f) As a result of the said failures, Maxwell Cook was fatally injured."

4 The offence under s10(1) of the Act alleges a failure at 16 Childs Road, Chipping Norton on 26 September 2001 by the defendant, being a person who had control of premises used by people, in particular Maxwell Cook, as a place of work, to ensure that the premises was safe and without risks to health.

5 The offence under s10(1) has been particularised in the Application for Order in the following way:

(a) At all material times, the Defendant was a company incorporated in the State of Queensland, which operated a trucking and haulage business in that State.

(b) In about June 2000, the Defendant purchased Top Container Transport Pty Ltd ("Top Container").

(c) Top Container at all material times, was a company incorporated in the State of Queensland, that was responsible for the operation and management of a warehouse facility for the general cartage, storage and distribution of steel and ceramic products located at 16 Childs Road, Chipping Norton, in the State of New South Wales ("the premises").

(d) At all material times the sole director and shareholder of the Defendant was Francis James Burn.

(e) Subsequent to the purchase of Top Container and at all material times, Francis James Burn was the sole director and shareholder of Top Container.

(f) At all material times, the Defendant had control over the premises and the operation of Top Container.

(g) Top Container, at all material times, employed a number of workers, including Maxwell Cook ("Cook"), to work at the premises.

(h) Top Container, at all material times operated plant, namely a Daewoo forklift truck, model no 252-2 and serial no 11-00412("the forklift"), at the premises.

(i) On 26 September 2001, as part of his duties, Cook used the forklift to stack steel crates containing stainless steel welded pipes ("the crates"). The crates were constructed of steel and were approximately 6200mm long, 600mm wide and 570mm high. The weight of a fully laden crate was approximately 1400kg.

(j) The Defendant, being a person who had control of premises used by people, in particular Cook, as a place of work on 26 September 2001 at Childs Road, Chipping Norton in the State of New South Wales, failed to ensure that the premises was safe and without risks to health, by:

1. failing to provide safe systems of work in that the Defendant:

a. failed to undertake a risk assessment that identified the maximum number of crates that could be safely stacked to ensure stability;

b. failed to provide and maintain a system of work that ensured people at the premises were not exposed to the risk of the crates falling on them.

2. failing to provide such training, instruction and supervision as was necessary to ensure the safety of people at work at the premises, in that the Defendant:

a. failed to provide training, supervision and instruction to the employees of Top Container to ensure the crates were stacked at the premises in a manner that was safe and without risk of injury

b. failed to instruct or train employees of Top Container in the identification of risks associated with the stacking of the crates.

(k) As a result of the said failures, Maxwell Cook was fatally injured.

6 The proceedings in relation to both offences were conducted as ex parte proceedings. The defendant did not enter a plea to either offence.

7 On 12 February 2004, the Administrator of the defendant, PPB Chartered Accountants & Business Reconstruction Specialists ("PPB") advised by letter that the defendant has no assets or money available for any unsecured creditor, or, to meet any costs associated with the present prosecutions. In the letter, PPB also advised:

"Under all circumstances, it will not be possible for me to cause legal representation to appear before the Commission in relation to this matter, given the financial inability to pay costs that would be incurred in that process."

8 The letter also attached a copy of the defendant's Statement of Affairs.

9 On 14 July 2004, the prosecutor wrote to the defendant advising it that the matters had been listed for hearing on 6 December 2004 at 10am in the Industrial Relations Commission.

10 On that day, when the matters came before the me for hearing, there was no appearance for the defendant.

Factual Background

11 A Statement of Facts was tendered by the prosecutor in the proceedings. In it, Francis James Burn ("Mr Burn") was nominated as the defendant's sole director. According to the document, the defendant occupied premises at 16 Childs Road, Chipping Norton, New South Wales ("the premises"). A co-defendant, Top Container Transport Pty Limited (In Liquidation) ("Top Container") employed approximately twenty workers to work at the premises. Mr Burn was also the sole director of Top Container.

12 The defendant was responsible for the operation and management of a warehouse facility for the general cartage, storage and distribution of products including cooling oil and products. At the time of the alleged offence, it handled Stemcor steel products. It also operated a Daewoo forklift truck model no. 252-2, serial number 11-00412 at the premises ("the forklift").

13 Maxwell Cook ("Mr Cook") was an employee of Top Container on the date of the alleged offences, that is, on 26 September 2001. On that day, he used the forklift to stack steel crates containing stainless steel welded pipes ("the crates"). The crates were approximately 6200mm long, 600mm wide and 750mm high. the weight of a fully laden crate was approximately 1,400 kilogrammes.

14 On 26 September 2001, twelve crates had been delivered to the premises from R&H Transport upon instructions from Stemcor (A/SIA) Pty Limited. Mr Cook commenced work that day at about 10am. He was assisted by another Top Container employee, Mark Lomas ("Mr Lomas") with the unloading and stacking of containers of nuts and bolts using the forklift.

15 The crates were delivered to the premises at around lunchtime. Mr Cook unloaded the crates using an overhead crane and then stacked the crates using the forklift. He stored them by stacking them one on top of the other, six crates high ("the stack").

16 Mr Lomas finished work that day at about 2.30pm. Thereafter, Mr Cook worked alone without supervision stacking the crates using the forklift. At about 3.40pm, while Mr Cook was operating the forklift near the stack, the stack collapsed and one of the crates fell on top of the forklift. The force of the collapse of the stack on the forklift resulted in Mr Cook suffering fatal injuries.

Consideration

17 Section 8(2) of the Act provides:

"An employer must ensure that people (other than the employees of the employer) are not exposed to risks to their health or safety arising from the conduct of the employer’s undertaking while they are at the employer’s place of work."

18 The elements of an offence under s8(2) which the prosecutor must prove beyond reasonable doubt in order to establish the offence are as follows:

(i) the defendant was an employer;

(ii) there were persons other than the employees of the defendant;

(iii) the persons were at the defendant's place of work;

(iv) the defendant failed to ensure that those persons were not exposed to risks to their health and safety;

(v) the risk arose from the conduct of the defendant's undertaking.

First element: the defendant was an employer

19 The Statement of Facts does not allege that the defendant was an employer.

20 Also tendered against the defendant during the proceedings was a brief of evidence compiled by the prosecutor.

21 The material contained in that brief of evidence in relation to the defendant's status as an employer may be summarised as follows:

(i) Mr Burn said the defendant had no employees, and, that Top Container, not the defendant, employed workers at the premises on 26 September 2001: Final Statement, Frank Burn, 21 September 2003, Q127, Q148;

(ii) in the same Final Statement, Mr Burn said that Top Container employed both himself and Mr Cook on 26 September 2001: Q40 and Q158 respectively;

(iii) in the Final Statement at Q50 to Q53, Mr Burn said he "worked for" the defendant from 1990 to 2001 and ceased employment with the defendant on 17 December 2001;

(iv) Don William Steel ("Mr Steel"), General Manager of Top Container and employed by Top Container from early February 2001 until 17 December 2001 said he worked for the defendant from 17 December, 2001 and, that, to the best of his knowledge, the defendant did not have employees: Manager's Statement, 22 September 2003: Q44, Q45, Q102, Q122, Q123;

(v) according to Mr Steel, the defendant traded as Burnsall Haulage: Manager's Statement: Q58, Q103;

(vi) according to Mr Burn, in answer to the question, "Who was Burnsall Haulage and what is the relationship between Top Container Transport Pty Ltd and Keralex Pty Ltd?", he said, "Keralex Pty Ltd": Final Statement, Q126;

(vii) Trevor McCaw said that on 26 September 2001, he was employed "at Burnsall Haulage": Witness Statement, 28 March 2002, Q10;

(viii) Mr Lomas said his employer was Burnsall Haulage: Witness Statement, 20 November 2001, Q6, Q13;

(ix) Stephen Hayward said that on 26 September 2001, he was employed by Burnsall Haulage: Witness Statement, Q9, Q10;

(x) Lyndsay Crowley ("Mr Crowley") at first said he was employed as a Sydney Manager on 26 September 2001 by "Burnsall Haulage, a division of Keralex Pty Ltd" and that that entity employed at the premises about 27 employees: Manager's Statement, 13 November 2001, Q6, Q7, Q16, Q17. Later, in a Manager's Statement dated 31 July 2003, the following exchanges took place between Mr Crowley and the prosecutor:

"Q34: Who employed you on 26 September 2001?

A: Top Container Transport Pty Ltd. I became aware of this after about month or so of joining the company when I received my first pay slip. I applied for a position with Chandler and MacLeod recruitment. When I was interviewed I was told that there a (sic)position with Burnsall Haulage, a division of Keralex Pty Ltd.

Q39: In reply to my question 6 of 13 November 2001, you said that you were employed by Burnsall Haulage, a division of Keralex Pty Ltd. In fact, as indicated in your letter to me on 25 October 2001, Burnsall Haulage is just the trading name. Is this your understanding?

A: My understanding was that Burnsall Haulage was a trading name.

Q44: In your Group Certificate for the year 2001/2002 who is listed as your employer, Keralex Pty Ltd or Top Container Pty Ltd?

A: Top Container Transport Pty Ltd.";

(xi) on 14 November 2001, Brett Maken said he was employed by "Burnsall Haulage" for about eight months;

(xii) an ASIC extract from the Australian Business Register included in the brief of evidence records that Burnsall Haulage is the trading name of the defendant as at 28 September 2001;

(xiii) an internal WorkCover document contained in the brief of evidence headed "WorkCover New South Wales Policy Term and Tariff Industry Report" records that Top Container Transport Pty Ltd had between 18 April 2001 until 18 April 2002 30 employees. There is no such document in the brief of evidence in the defendant's name.

22 The foregoing evidence represents the entirety of the evidence before me as to the defendant's status as an employer. That evidence as it stands is simply not sufficiently conclusive, to the requisite standard, of a finding that the defendant as at 26 September, 2001 was an employer. The brief of evidence contains none of the usual documentation such as group certificates, which might otherwise be determinative of a finding that the defendant was an employer. The Statement of Facts is silent on the issue.

23 Given the state of the evidence in relation to the first element which must be proved by the prosecutor beyond reasonable doubt, I find that the prosecutor has failed to prove the offence alleged under s8(2) of the Act. Accordingly, Application for Order No IRC 5368 of 2003 must be dismissed.

Section 10(1) alleged offence

24 Section 10(1) of the Act provides:

"A person who has control of premises used by people as a place of work must ensure that the premises are safe and without risks to health"

25 The elements of an offence under s10(1) which the prosecutor must prove beyond reasonable doubt in order to establish the offence are as follows:

"(i) the defendant had control of the premises;

(ii) the premises were used by people as a place of work;

(iii) the defendant failed to ensure that the premises were safe and without risks to health."

The defendant had control of the premises

26 Section 10(4)(a) of the Act provides some assistance in determining the extent to which a person can exercise control of the premises in order to fall within the terms of s10(1). Section 10(4)(a) relevantly provides:

"In this section, a person who has control of premises... includes:

(a) person who has only limited control of the premises... (in which case any duty under this section applies only to the matters over which the person has control)...."

27 The element of control in the precursor section to s10(1), namely s17(1) of the Occupational Health and Safety Act 1983 ("the 1983 Act"), was discussed by the Full Bench in McMillan Britton and Kell Pty Limited v WorkCover of New South Wales (Inspector Blake) (1999) 89 IR 464. After considering various dictionary definitions, and concluding that the word "control" has a wide meaning, the Full Bench referred to the High Court decision in Commissioner of Taxation (Cth) v Australia and New Zealand Bank Group Pty Ltd (1979) 143 CLR 499, where it was held (at 533):

"The content of 'control' is somewhat different from that of 'custody'; however, both are "wide enough to include many types of possession which are not commensurate with full ownership" (Johnston Fear & Kingham v The Commonwealth (1943) 67 CLR 314 at 324, per Rich J). It is difficult to ascribe a precise meaning to 'control' in s 264 as the content of the word is normally dictated by its context and can vary from sole absolute dominion over the object 'controlled' to 'something' weaker than restraint, something equivalent to regulation' (Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 385 , per Dixon J). Although the use of the composite expression 'in his custody or under his control' does not assist us in determining the precise limits of the meaning of 'control', it does evidence a legislative intention to employ the words in their widest sense."

28 The Statement of Facts tendered against Keralex by the prosecution in the ex parte proceedings states that Keralex occupied the premises and was responsible for the operation and management of, "a warehouse facility" for the general cartage, storage and distribution of products, at the date of the offence. Mr Burns, the sole director of both Keralex and Top Container, was, according to the Statement of Facts, "ultimately responsible for all systems of work and work methods employed by Keralex and Top Container" (at [8], [9]).

29 In the brief of evidence Mr Burn said (interview, 21 September 2003) that Keralex operated its New South Wales business activities from the premises. The owner of those premises on 26 September, 2001 was, he said, Jacksoan Pty Ltd. Mr Burn spent some five days each month at the premises. Both Mr Burn and Don Steel ("Mr Steel"), the General Manager of Top Container at the time of the alleged offence, said that Top Container also conducted its business activities from the premises, (Mr Steel's interview 22 September, 2003). Mr Steel also said that Keralex carried on the business of Burnsall Haulage, and that Top Container was the employer.

30 Mr Crowley in his second interview (31 July, 2003), which formed part of the brief of evidence, described himself as the Sydney manager of Burnsall Haulage on 26 September, 2001. He described Burnsall Haulage as a "division" of Keralex and said, he was employed at that time by Top Container. Later in the interview he said he understood that Burnsall Haulage was the trading name of Keralex. In his first interview (13 November, 2001) he described the main operations at the premises as "container cartage, container unpack, storage and distribution and general cartage. There is also interstate and intrastate transport". He said Keralex acted as a third party warehouse for customers, for example tile and steel importers and food importers. In his second record of interview he said Keralex sent out purchase orders, "or any verbal orders" using the name Burnsall Haulage.

31 Various documentation contained in the brief of evidence in existence prior to 26 September, 2001 describes Burnsall Haulage as a division of Keralex. One such document dated 17 September, 2001 outlines a disciplinary code to be followed by staff "employed by Burnsall Haulage" at the premises. Another document, which is undated (but which, according to Mr Steel, was written in October 2001) entitled "Burnsall Haulage Company Profile" states in its opening paragraph:

"Burnsall Haulage is part of a private company Keralex Pty Ltd established and developed into a highly successful and reputable organization by Frank Burn. The primary objectives of the company are to provide service reliability and customer satisfaction through the use of a large and diverse fleet of company vehicles and experienced personnel, along with a base of well established subcontractors. Recent business acquisitions and company relocations have further provided the platform for Burnsall Haulage to continue to achieve first class, benchmark results within the transport industry."

32 The document then proceeds to list the services provided by Burnsall Haulage and the equipment it owns.

33 Mr Crowley was working in his office at the premises typing up quotations when Mr Cook was fatally injured on 26 September, 2001.

34 From this review of the available evidence it can be established that Keralex, although not the owner of the premises, and not the employer of persons who worked at the premises, nevertheless co-ordinated the business activities of the premises which included the unpacking and storage of goods delivered to the premises. Although the evidence is not sufficiently clear to determine precisely the delineation of functions between Keralex and Top Container for the purpose of assessing the degree of control exercised be each of those entities, it is not necessary for the purposes of section 10(1) to find that the defendant had exclusive or even predominant control of the premises at the relevant time. The duty under s10(1) to ensure premises are safe extends to persons who have only limited control of the premises, and, where the evidence establishes this, the duty extends only to those matters over which the person has control: s10(4)(a).

35 I therefore find beyond reasonable doubt that Keralex had control of the premises on 26 September, 2001 because it was coordinating, among other activities, the unpacking and storage of goods delivered to the premises. This was the precise activity in which Mr Cook was engaged at the time of his fatal accident.

The premises were used by people as a place of work.

36 There is little difficulty in concluding to the requisite standard, in relation to the second element, that on 26 September, 2001 the premises were used by people as a place of work. Mr Cook, an employee of Top Container at that time, was working at the premises as a forklift driver, loader and storeman (Mr Burn's interview Q159 and Q175). Mr Crowley, the Sydney manager was also working at the premises. Mr Lomas was, until about 2.30pm on 26 September assisting Mr Cook to stack the crates at the premises (Mr Lomas interview 20 November, 2001, Q34, Q35, Q44).

37 I note for completeness that "place of work" is defined in s4 of the Act as "premises where people work". "Premises" is defined as including any place, including, any land, building or part of any building, and, any installation on land.

The defendant failed to ensure that the premises were safe.

38 The limits of the duty under s10(1) to ensure safe premises are set out in s10(3) of the Act. Under s10(3) the duties of a person in relation to ensuring safe premises under s10(1) do not apply to premises used only by employees of the person; or, to premises occupied only as a private dwelling. The duties however, extend to the means of access to or exit from a place of work, but, only apply if the premises is controlled in the course of trade, business or other undertaking (whether for profit or not) of the person.

39 An examination of the available evidence referred to above on this aspect of the charge discloses that:

(i) the premises was used by employees of Top Container;

(ii) the premises was a warehouse facility used for the delivery and storage of goods, which was a business activity conducted by Keralex;

(iii) the particular activity engaged in by Mr Cook at the time of the accident was one taking place inside the premises;

(iv) Keralex had control of the premises in the course of its business, namely, the coordination of delivery and storage of goods.

40 I turn now to consider whether the defendant failed to ensure the premises on 26 September, 2001 was safe.

41 There is no evidence to suggest that there was anything about the physical premises that was unsafe, rather, the activity being conducted on the premises by Mr Cook on 26 September, 2001 was, the prosecutor alleges, unsafe, because no systems of work, and no training, instruction or supervision were provided to ensure the safety of people at work on the day.

42 Many of the cases under s17(1)(a) of the 1983 Act, the predecessor section to s10(1), have dealt with the particular aspect of whether a premises is unsafe by considering whether the physical premises or part of the physical premises was unsafe or whether something attached to or connected to the premises rendered those premises unsafe.

43 Staunton J in Rodney Dale Morrison v Eureka Opal Pty Limited [2005] NSWIRComm 80, considered an offence brought under s17(1)(a) of the Act where the premises was an opal mine in which part of the roof collapsed.

44 In Rodney Morrison v Akula Pty Limited formerly known as Raise Bore Australia Pty Ltd [2004] NSWIRComm 41, another offence under s17(1)(a) of the Act, the risk arose from falling rocks from the top and sides of a mine shaft.

45 Inspector Maltby v Josef and Sons Pty Ltd [2003] NSWIRComm 336, dealt with an the offence under s17(1)(a) and concerned premises described as Kogarah Railway Station and adjoining area. The risk arose when an excavator was operated at the premises close to a charged gas supply line.

46 In Inspector Gabrielle Belley v Rail Infrastructure Corporation [2001] NSWIRComm 323, another s17(1)(a) offence, the risk arose from a narrow railway track clearance which formed part of the premises at Trangie Rail Yard.

47 In WorkCover Authority of New South Wales v McDonald's Australia Limited and Another (1995) 95 IR 383, in which McDonald's was charged under s17(1)(a) of the Act, a worker was fatally injured when he came into contact with an exposed inner core of an electrical cable attached to kitchen equipment known as a clamshell grill.

48 Peterson J in WorkCover Authority of New South Wales (Inspector Buggy) v Newcastle Rail Corporation [2001] NSWIRComm 251 was confronted with a slightly different set of facts for determination as to whether the premises was unsafe under s17(1)(a) of the Act. In that case, a wharf in Newcastle Harbour was rendered unsafe by reason of certain work-related activities (the transportation of shipping containers) which made certain areas of the wharf dangerous areas in which to work: [11], [16].

49 In the present proceedings, it is alleged that the activities of Mr Cook made the premises unsafe for persons, including himself, to use as a place of work, in accordance with s10(1), that is, the premises became unsafe on the evidence, when Mr Cook on 26 September, 2001 stacked the crates in such a way that there was a risk of the crates toppling over and injuring any person in the near vicinity. At the same time, the defendant was in control of the premises by virtue of its role as co-ordinator of the packaging and storage of goods in the premises. In my view, these facts support the finding that the premises were unsafe under s10(1).

Whether there was a risk to safety

50 It remains to consider whether there was a risk to safety and, if so, whether the risk to safety arose by reason of some act or omission on the part of the defendant.

51 According to the Application for Order, the defendant failed to undertake a risk assessment that identified the maximum number of crates that could be safely stacked to ensure stability; and, failed to provide a system of work that ensured that people at the premises were not exposed to the risk of the crates falling on them. In addition, the defendant allegedly failed to provide training, supervision and instruction as was necessary to ensure the crates were safely stacked and to identify risks associated with the stacking of the crates.

52 According to Mr Lomas, on 26 September 2001, one load of Stemcor steel products arrived at the premises. The load consisted of some twelve crates. The crates were stacked on top of each other, six high, against the western wall by the side door. The crates were lifted by means of a forklift. Mr Cook stacked two stacks, six high. Mr Lomas says Mr Cook "would have" started at about 1pm and finished at 2.45pm. Mr Lomas saw Mr Cook stacking the crates at the beginning of the task. At that stage, the stack would have been "three high". A previous load of Stemcor steel products was stacked about a month before by Mr Lomas who stacked three stacks using a forklift and a crane. (Photographs forming part of the evidence taken by the prosecutor on 27 September 2001 confirm that the two stacks of crates stacked by Mr Cook on 26 September 2001 were stacked loose, six feet high.)

53 A report contained in the brief of evidence dated 26 February 2002 and headed "Burnsall Haulage FLT Accident" produces calculations of the angle of tilt required to cause overturning of stacked crates stacked six high. The report was commissioned by the WorkCover Authority of New South Wales and prepared by Senior Inspector Alan Kerruish. The width and height of the crates tested were identical to the dimensions of the crates which toppled over and fatally injured Mr Cook on 26 September 2001. An assumption is made for the purposes of the test that each case or crate in the stack is of equal weight and that the weight in each crate is evenly distributed. The report concludes that a six-crate high loose stack, with its centre of gravity at 3,300 mm above ground level, requires a 456' angle of tilt to cause it to overturn.

54 Although the report does not purport to duplicate the exact conditions existing at the time of the fatal accident, some reliance may nevertheless be on it as an indication that the six crates stacked in two loose stacks by Mr Cook at the time of the accident (as the evidence suggests) required only a small angle of tilt in order to give rise to a risk of toppling over.

Whether there was a failure to undertake a risk assessment

55 The prosecutor particularised the failure to undertake a risk assessment in terms of a failure to assess the risk associated with identifying the maximum number of crates that could be safely stacked to ensure safety.

56 The available evidence in relation to the particular is, in summary:

(i) Mr Burn did not know when interviewed by the prosecutor on 21 September, 2003, who was responsible for occupational health and safety matters at the premises, or, whether there were any policies and procedures established, and, if established, whether they were implemented at the premises. Mr Burn said that he did not carry out any risk assessment, "of the company's operations" at the premises;

(ii) Mr Steel in his interview of 22 September, 2003 said he did not carry out a risk assessment of "the company's" premises;

(iii) Mr Crowley in his first interview on 13 November, 2001 said that no risk assessment was conducted prior to the accident on 26 September, 2001, on the safe and stable storage of the steel crates.

57 The evidence immediately referred to above would enable me to conclude beyond reasonable doubt that the defendant, on 26 September, 2001, being a person who had control of premises used by people as a place of work failed to ensure the premises were safe and without risks to health in that it failed to undertake a risk assessment that identified the maximum number of crates that could be safely stacked to ensure stability.

Whether failure to provide safe system of work

58 The prosecutor also alleges against the defendant a failure to, "provide and maintain" a system of work that ensured that people at the premises were not exposed to the risk of crates falling on them.

59 I note in passing that the use of the word "maintain" is redundant if the evidence does not disclose to the requisite standard a failure to provide a system of work in the terms defined. If, therefore, what the prosecutor is alleging is really a failure to provide a system of work, it is not necessary to add the words "and maintain" to the application for order.

60 The evidence in relation to this particular, in summary, is:

(i) Mr Burn was not aware of any system of work at the premises on 26 September 2001 in regard to handling clients' products.

(ii) Mr Steel said he did not establish any work procedures at the premises because it was not his area of responsibility. He did not provide any advice to workers covering safe work practices; and, he was not aware of any systems of work at the premises for handling clients' products.

(iii) Mr Crowley in his first interview told the prosecutor that at the time of the fatal accident, Mr Cook was working alone. Mr Cook started work at 10am, Mr Hayward was his supervisor. The storage of the Stemcor product was discussed by Mr Cook and Mr Lomas who agreed that the crates should be stacked four to five high. According to Mr Crowley "for some unknown reason the crates were stacked six high". In answer to a question, "Did the company put in place a safe system of work to handle steel crates?", Mr Crowley said, he didn't know whether there were any previous instructions.

61 The references to "the company" are not helpful in the ascertainment of which corporate defendant was in breach of a failure as alleged at any time. In circumstances however where Mr Burn was the sole director of both corporations and where on the evidence Mr Burn did not appear to delineate, at least in so far as safety is concerned, between the functions of each corporate defendant, the references may be taken to mean either Keralex or Top Container.

62 This evidence, considered as a whole, in relation to this second particular, establishes, beyond reasonable doubt that there was a failure on the part of the defendant, under s10(1) of the Act to provide a safe system of work.

Whether there was a failure to provide training, supervision and instruction to ensure the crates were stacked safely

63 The available evidence in relation to the third particular is:

(i) Mr Burn said in his interview that he didn't know whether Mr Cook was provided with information, instruction, training or supervision in the handling of Stemcor products

(ii) Mr Steel said in his interview that he was not aware if employees of Top Container had been given any training in operating plant and equipment at the premises

(iii) Mr Lomas in his statement dated 20 November, 2001 said that no instructions were given about how to stack the Stemcor steel products at the premises. Mr Lomas also said that he had received no training in the storing and packing of products at the premises

(iv) Mr Hayward said in his statement dated 14 November, 2001 that Mr Cook was not given any instructions on how to store products in the premises; and, that "Burnsall Haulage" did not, to his knowledge, provide any training in relation to the safe storage and handling of steel products in the premises

(v) Mr Crowley said that no specific instructions were given with regard to the handling and safe storage of the product. In addition, he did not know whether any information was provided to employees in relation to the safe handling and storage of the steel crates. Mr Cook, according to Mr Crowley was not given any specific instructions prior to commencing work on 26 September, 2001. In his second interview Mr Crowley said he was not provided with any occupational health and safety training at Burnsall Haulage, and, he was not provided with any guidelines, policies or procedures for the training of employees in the safe manner in which the steel containers were to be unloaded and stacked or stored in the premises.

(vi) Mr Cook was working alone in the premises at the time of the fatal accident.

64 The evidence detailed above establishes beyond reasonable doubt the third particular contained in the application for order.

Whether there was a failure to train or instruct employees in the identification of risks associated with the stacking of crates.

65 The fourth and final particular alleges a failure to instruct or train employees of the defendant in the identification of risks associated with the stacking of the crates. There is substantial overlap between this particular and the other three particulars insofar as the evidence relevant to those other particulars dealing with the lack of policies, procedures and guidelines in relation to the manner in which the crates were to be stacked, and various failures to instruct, train or supervise employees in the storing and packing of crates, is also relevant evidence to make out the fourth particular.

66 An assessment of this evidence enables the conclusion that the fourth particular is also made out by the prosecutor beyond reasonable doubt.

67 I make the following orders:

(i) Application for Order in Matter No IRC 5368 of 2003 is dismissed;

(ii) In Application for Order Matter No IRC 5367 of 2003 the offence is proven; the defendant is found guilty and convicted.

Sentence Proceedings: Matter No IRC 4367 of 2003

68 I now proceed to sentence the defendant for the offence which the defendant has been convicted in Application for Order No IRC 5367 of 2003. The decision to proceed to sentence forthwith is made on three bases. First, on 6 December, 2004 the Court was requested by the prosecutor, in the event the offences were found proven, to be heard on sentence, which is what occurred on that day. Secondly, the letter written by the Administrator of the defendant, PPB, on 12 February, 2004 strongly suggests in its terms that the defendant had no intention of appearing before the Court in any proceedings (refer [7] of this judgment). Thirdly, the defendant did not appear at the ex parte proceedings.

69 Mr Reitano of Counsel, for the prosecutor submitted that the offence was objectively serious having regard to the consequences of the breach, the obviousness of the risk, and, the simple steps that were readily available to avoid placing employees at risk in the circumstances.

Consequences of the breach

70 In relation to the consequences of the breach, (here the tragic death of Mr Cook), Mr Reitano submitted that the likelihood of such a consequence given the weight and dimensions of the crates was obvious, and, in addition there existed reasonably straightforward and simple steps, which could have been taken by the defendant to avoid the risk. These circumstances "cast light on the seriousness of the offence."

Foreseeability and obviousness of the risk.

71 Mr Reitano placed reliance on a number of factors to support a submission that the risk (to safety) was foreseeable. These factors were:

(i) the risk of forklifts in a warehousing environment must be seen as something that is to be regarded as, "fairly naturally" raising concerns about safety;

(ii) the risk to safety created by using a forklift to lift a 1400kg weight is, "something that commonsense would dictate the necessity of even the ... simplest of risk assessments"

(iii) the complete lack of any supervision and training at all must obviously have rendered the work in question to be dangerous.

Availability of simple remedial steps

72 Post accident measures implemented by Top Container at the premises highlight the ready availability of such measures prior to the offence. These post accident measures are reproduced by the prosecutor as follows:-

Since the accident date, Top Container implemented the following changes:

a) Implemented a system on 2 October 2001 to:

1) inspect all products when received at the premises;

2) unload the product by overhead crane;

3) place damaged crates to the top of the stack;

4) to not stack crates more than 4 crates high or 2.4 metres whichever is the greater.

b) Subsequent to Top Container engaging a safety consultant, Environment Friendly Logistics, implemented a system after 23 October 2001, to ensure the crates in the premises were made stable and secure and reduced in stacking height to below 4 metres.

c) After 23 October 2001, Top Container set up a safety committee and implemented occupational, health and safety training for its employees, neither of which had previously been in place.

Deterrence

73 In relation to general and specific deterrence Mr Reitano contended that both principles assumed some importance in the circumstances of this case.

74 Mr Reitano also reminded the Court in oral submissions that there are no subjective matters put forward for consideration.

75 In relation to the defendants' financial circumstances, being a company presently under administration, Mr Reitano urged the Court to adopt Boland J's approach in Inspector Jones v T Helsby & Sons Contracting Pty Ltd (No 2) [2004] NSWIRComm 57.

Consideration

Maximum Penalty

76 The defendant faces a maximum penalty of $550,000.

Reasonably foreseeable risk to safety

77 The risk to safety arose from the risk of the crates toppling over. The risk of crates toppling over arose from the unsafe method employed to stack crates. The unsafe method utilised to stack the crates was the direct result of the non-provision by the defendant and Top Container to Mr Cook and other employees, of any practices, procedures, training, instruction or information in relation to the safe undertaking of the task.

78 There were inherent dangers associated with the operation. Mr Cook at the time of his fatal accident was working alone. He was working with heavy and cumbersome items of plant, namely the crates and contents; and using a forklift to transport and stack the items.

79 In all these circumstances no other conclusion is available other than that the risk to safety was both obvious and foreseeable.

80 This conclusion renders the offence objectively serious: WorkCover Authority of New South Wales v Kirk Group Holdings Pty Limited (2004) 135 IR 166 at 216 per Walton J, Vice-President.

81 The evidence reveals that the defendant directed no attention at all to any matters concerning safety. In addition, many simple, effective, and available measures could have been implemented by the defendant prior to the 26 September, 2001, and would have substantially obviated the risk . The objective seriousness of the offence is compounded by these additional matters: Inspector Paul Kenneth Wade v Ken Mathews Haulier Pty Limited t/as Ken Mathews Landscaping Supplies [2005] NSWIRComm 85 at [35].

Deterrence

82 In this matter general deterrence is relevant. The circumstances of this tragic accident reveal yet again the paramount importance of workers' safety in the workplace and the need to seek out and identify risks to safety, and, implement measures to obviate, or, where possible, eliminate those risks. Workers at the very least are entitled to work in an environment in which they are secure in the knowledge that such measures have been taken so that they may work without fear of injury to themselves and others.

83 Special deterrence assumes less significance. The defendant has been in administration since 17 December, 2001. According to correspondence in the brief of evidence a return in the administration is unlikely. In the absence of evidence as to the direction the administration is taking, and, whether or not it is, or will, continue to trade I propose to include as a component of the penalty imposed a small amount for specific deterrence: Capral Aluminium Limited v WorkCover Authority of New South Wales (Inspector Mayo-Ramsay) (2000) 99 IR 29.

Consequences of the breach

84 Here, the death of Mr Cook manifests the degree of seriousness of the risk to safety to which Mr Cook and others at the premises were subjected. This is because of the complete lack of any training, instruction or supervision or procedures in an environment in which heavy items of plant were transported and stored and heavy machinery utilised such as a forklift, at the time of the offence. This factor contributes to the seriousness of the offence: Morrison v Powercoal Pty Ltd & Anor (No 3) [2005] NSWIRComm 61, at [93], [94] and [95].

Respective culpabilities of the defendant and Top Container

85 Although the prosecutor did not raise the issue of culpability between the two corporate defendants, it is my view that the issue requires consideration. The responsibility for attending to matters of safety at the premises must squarely lie with both corporate defendants. Although Top Container has a prior conviction, it is under the Workers Compensation Act 1987 and is unrelated to matters of occupational health and safety.

86 Both corporate defendants had, during the period of the offence, common directorship, and, although the defendant and Top Container exercised different functions in relation to the premises and were charged with different offences under the 2000 Act, both nevertheless faced offences which particularised almost identical failures to ensure safety.

87 In these circumstances I regard the contribution, and therefore the culpability, of each defendant to the detriment to safety occasioned by the failures to ensure safety as particularised in the Applications for Order as equal: refer, for example, WorkCover Authority of New South Wales (Inspector Ankucic) v McDonalds Australia Limited and Another (1999) 95 IR 383 at 437.

Personal Factors

88 The defendant did not enter a plea in this matter so no discount for penalty is available. Further, given the defendant's failure to appear no personal factors were raised. The Court was informed that the defendant does not have any record of previous convictions. This is a mitigating factor which will be taken into account on sentence: s21A(3)(e) Crimes (Sentencing Procedure) Act 1999.

Defendant's Financial Means

89 One further matter that requires attention is the capacity of the defendant to pay a fine. The correspondence from the Administrator suggests that the defendant has little financial means. No other information is forthcoming which would enable a sufficiently comprehensive assessment to be undertaken of the defendant's capacity to pay a fine. In these circumstances I propose to adopt the approach of Boland J in Inspector Jones v J Helsby & Sons Contracting Pty Ltd (No 2) [2004] NSWIRComm 57 at [15] where his Honour said:

"It is apparent from some of the information filed by the prosecutor that the defendant claimed it had a level of debt that, according to the Administrator, prevented the defendant from defending the prosecution. It might be thought that the imposition of a penalty on the defendant would, in the circumstances, be futile. Two things may be said about that. Firstly, no proof of debt was in evidence. Secondly, one of the principal purposes of punishment is to deter future breaches by others. General deterrence is an important consideration in this matter given the very high danger of persons being affected by carbon monoxide emissions from concrete cutting machines where they are used in enclosed areas."

Penalty

90 In determining penalty against the defendant I have taken into account the objective seriousness of the offence, the absence of prior convictions, the respective culpabilities of the defendant and Top Container, and, the defendant's capacity to pay a fine.

Orders.

91 I make the following orders:

1. Application for Order No IRC 5368 of 2003 is dismissed.

2. In Application for Order No IRC 5367 of 2003 the offence under s10(1) is proven, and, the defendant is convicted.

3. In Application for Order No IRC 5367 of 2003 the defendant is fined $135,000 with a moiety thereof to the prosecutor.

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LAST UPDATED: 23/06/2005