Inspector Ian Lancaster v Rail Corporation of New South Wales. Prosecution under s 8(1) of the Occupational Health and Safety Act 2000 [2008] NSWIRComm 189 (7 October 2008)

Last Updated: 24 October 2008

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION :
Inspector Ian Lancaster v Rail Corporation of New South Wales. Prosecution under s 8(1) of the Occupational Health and Safety Act 2000 [2008] NSWIRComm 189



FILE NUMBER(S):
IRC 550

HEARING DATE(S):
23 July 2008
Directions: 17 September 2008

DATE OF JUDGMENT:
7 October 2008

PARTIES:
PROSECUTOR:
Inspector Ian Lancaster

DEFENDANT:
Rail Corporation of New South Wales

CORAM:
Haylen J


CATCHWORDS: Occupational Health and Safety Act 2000 - s 8(1) s 121(3) - Crown
agency established with transfer of staff and property from another existing Crown agency - original Crown agency not dissolved but continues to operate - plea of guilty entered to breach of s 8(1) - unsafe system of work - movement of containers at railway depot by use of loader and forklift in combination - jib attachment dislodges and seriously injures employee - whether defendant a previous offender by virtue of prior record of Rail Infrastructure Corporation - statutory interpretation - consideration of operation of Pt 7, Div 3 of the Act - serious breach established - general and specific deterrence - subjective factors - early plea - extensive safety systems in operation - penalty imposed.

Statutory interpretation - use of extrinsic material - legislative history considered - Minister's second reading speech - meaning of "predecessor" in s 121(3) Occupational Health and Safety Act 2000 - operation of Pt 7 Division 3 considered.





LEGAL REPRESENTATIVES

PROSECUTOR:
Mr M Cahill of counsel
SOLICITORS:
Mr W Steenson
WorkCover Authority Legal Group

DEFENDANT:
Mr P Kite SC
SOLICITORS:
Ms L Constantine
Blake Dawson


CASES CITED:
Cole v Director General, Department of Youth and Community Services and anor (1987) 7 NSWLR 541 at 546 per Kirby P
Dreyfus (Camille and Henry) Foundation Inc v Inland Revenue Commissioners [1956] AC 39
Esso Australia Resources Ltd v FTC [1998] FCA 1655; (1998) 83 FCR 511 at 518-19
Inland Revenue Commissioners v Plummer [1980] AC 896
Inspector Keelty v Crown in Right of the State of New South Wales (Police Service of NSW) (No 3) (2002) 112 IR 144
Inspector Wong v Clarence Valley Council [2006] NSWIRComm 250
Saraswati v The Queen [1991] HCA 21; (1990) 172 CLR 1 per McHugh J at 21
Shorten v David Hurst Constructions Pty ltd [2008] NSWCA 134
WorkCover Authority of New South Wales (Inspector Gilbert) v Energy Australia (formerly Sydney Electricity) (1998) 85 IR 99
Workcover Authority of New South Wales (Inspector Rech) v Sydney Market Authority (1997) 82 IR 134
WorkCover Authority of New South Wales (Inspector Tuckley) v The Crown in Right of the State of New South Wales (Department of Community Services) (1999) 96 IR 1

LEGISLATION CITED:
Occupational Health and Safety Act 1983
Occupational Health and Safety Act 2000
State Owned Corporations Act 1989 s 20F
Transport Administration Amendment (Railway Agencies) 2003
ss 118. 119,120, 121 and 123 Pt 7, Division 3


TEXTS CITED:




JUDGMENT:

INDUSTRIAL COURT OF NEW SOUTH WALES

CORAM: HAYLEN J

7 October 2008

Matter No IRC 550 of 2007
INSPECTOR IAN LANCASTER v RAIL CORPORATION NEW SOUTH WALES
Prosecution under s 8(1) of the Occupational Health and Safety Act 2000

JUDGMENT
[2008] NSWIRComm 189

A WORKPLACE ACCIDENT

1 Rail Corporation of New South Wales ("RailCorp") was established as a State owned corporation on 1 January 2004 under the Transport Administration Amendment (Railway Agencies) 2003 (the "Ámendment Act"). Under the Amendment Act, RailCorp was to operate railway passenger services and on 18 May 2005 that function included the operation of a RailCorp depot situated at 10 Old Springhill Road, Coniston.

2 On that day, a number of RailCorp employees were working at the premises including Mr Steve Olsen, Mr Glenn Coltman, Mr Wallace Cook and Mr Stephen Milgate. Mr Olsen was the team leader responsible for the supervision of nominated work gangs and the work associated with re-locating shipping containers at the Depot. On this day, Mr Olsen was not present but Mr Cook was acting in a supervisory capacity. In order to re-locate the shipping containers, RailCorp contracted Total Plant Services Pty Ltd to supply plant and equipment for this task. They were to supply a Volvo EL 70 loader/backhoe and a plant operator, Mr Brian Clark. In the course of moving a particular container on this day, both the hired loader/backhoe and a forklift driven by Mr Cook were used to lift and position the container. During this work, a jib attachment on the loader dislodged and in falling, struck Mr Coltman on the head and he received serious injuries.

3 This incident was investigated by the WorkCover Authority and in May 2007, Inspector Lancaster commenced proceedings in the Court alleging that RailCorp was in breach of s 8(1) of the Occupational Health and Safety Act 2000. After further particulars were supplied to RailCorp, a plea of guilty was entered on the third occasion that the matter came before the Court. This judgment deals with the evidence and submissions on sentence.

4 The particulars of the alleged breach of s 8(1) of the Act were as follows:

The defendant failed to ensure a system of work that was safe and without risks to health, in that the defendant:

(a) Failed to ensure that the systems of work for the relocation of shopping containers in and about the site were safe.

(b) Failed to ensure that the plant used in the relocation of shipping containers on the site was properly used, such as to not expose persons to risk of injury.

(c) Failed to provide such information and instruction as was necessary to ensure that the task of relocating shipping containers was done without exposing persons to risk of injury.

THE EVIDENCE

5 At the hearing the prosecutor tendered an Agreed Statement of Facts together with a factual inspection report prepared by Inspector Lancaster and a number of photographs of the site and the equipment involved, taken by the Inspector on the day of the accident or shortly thereafter. The prosecutor also tendered a document entitled "Metropolitan Network Diagram" as representing the Metropolitan Rail Area Map setting out the metropolitan rail area operated by the defendant as identified in s 3A of the Amendment Act. The Agreed Statement of Facts appears as an annexure to this judgment.

6 For the defendant, two affidavits were filed and read. The first affidavit was sworn by Mr Nigel Howlett, General Manger of RailCorp and the second affidavit was sworn by Ms Clare Kitcher, Group General Manager, Safety and Environment, a position held within RailCorp. Ms Kitcher's affidavit, amongst other things, dealt with the establishment of RailCorp and its operations. RailCorp had been established as a State Owned Corporation in January 2004 under the Amendment Act and staff and assets had progressively been transferred from both the State Rail Authority and the Rail Infrastructure Corporation ("RIC") since the Amendment Act had commenced. The operations of RailCorp were described as "extensive" with approximately 13,800 people employed across two registered businesses namely, CityRail and CountryLink. Both CityRail and CountryLink operations ran 24 hours a day, seven days per week.

7 The size of the operation was emphasised by reference to CityRail, operating a fleet of more than 1,500 carriages running on over 3,200 kms of track controlled by 2,500 signals, with approximately 2,500 weekday passenger services and 1,600 weekend services operating daily. CityRail services were estimated to conduct approximately 900,000 passenger journeys per weekday to and from 300 stations and there were approximately 281 million passenger journeys in the year 2006-2007. In relation to CountryLink operations, they involved a fleet of 60 XPT carriages, 19 power cars and 23 Xplorer carriages providing approximately 144 weekly rail services with approximately 560 weekly road coach services to 363 destinations. RailCorporation's operations encompassed a vast number and type of workplaces located throughout metropolitan and regional New South Wales including railway stations, rail tracks and rail depots.

8 Ms Kitcher provided a great deal of detail about RailCorporation's commitment to safety, how safety featured in its strategic plan and how that emphasis on safety was conveyed to its vast workforce, including those who were contracted. RailCorporation's safety policies were under constant review with RailCorp promoting an integrated approach to safety and environment management through its Safe Management System. Prior to the establishment of RailCorp, RIC used a Safe Management System made available to staff by use of a workplace safety manual. When RailCorp was established in 2004, the RIC's Safety Management System was adopted in those parts of the operation taken over by RailCorp while its own system was being developed. Coniston rail depot was a workplace at which the RIC's Safety Management System applied. In developing its own system, RailCorp targeted six areas and developed the system in 2004 with consequential changes being implemented in 2005. Workplace safety manuals remained the local occupational health and safety working instruction at all infrastructure depots during 2005, including the Coniston rail depot. From early 2005, RailCorp focused on simplifying the system and improving its workability at the workplace and reviewing the system against relevant legislation for compliance. This work took place during the latter part of 2006 and 2007. Ms Kitcher described the RailCorp Safety Management System as being a risk based integrated management system dealing with operational systems and occupational health and safety issues. The system consisted of 20 elements and included "various suites" of documentation such as system requirements, procedures, guides, forms and local instructions covering safe work method statements and safe work instruction. There were nine areas identified as key occupational health and safety priority areas that received particular attention in workplace risk management. All workers were able to access the system via the RailCorp intranet or in hard copy or by looking at a local workplace safety folder. All line managers were provided with safety systems training. In 2007 a training needs analysis was undertaken to identify those aspects of the system about which particular managers required more detailed knowledge based on their areas of responsibility and the type of work undertaken within those areas. Upon completing the analysis, the relevant line managers had been trained in specifically designed safety and training courses and that process was continuing.

9 The operation of the workplace risk register was explained and how those registers were prepared in consultation with workplace safety committees and safety representatives. The registers were available to employees and other workers and all were able to make contributions to the hazard assessment and incident prevention process. Ms Kitcher also explained how RailCorp approached safe work method statements, risk assessments and safe work instructions, the working safety handbook and the provision of site specific induction. In relation to training, RailCorp had a dedicated training unit.

10 Contractors to RailCorp were required to conform with those parts of the safety system that applied to the work on which they were engaged. In April 2007, RailCorp contractors were invited to attend a "contractor specific" safety convention where RailCorp communicated its safety expectations and provided a forum for discussion of relevant issues. Another contractor specific safety convention is proposed to be held during 2008. RailCorp had developed a contractor specific website that included a guide to working safely in the RailCorp corridor: it provided easy access to RailCorp policies, safety alerts and safety firsts and information about relevant parts of the safety system and a hazard location register. In 2006 and 2007 RailCorp had contacted its contractors requesting them to provide lost time injury frequency rate statistics and asking those contractors who had high figures to explain to RailCorp strategies they intended to adopt to reduce that frequency. RailCorp had offered to provide assistance to those contractors to achieve a reduction in injury frequencies.

11 It was explained that a "safety alert" was used to communicate to all workers across the organisation as quickly as possible any urgent safety related message that required or potentially required organisational change or identified an issue affecting the organisation as a whole. An example was advising of defective equipment to be withdrawn from use or warning of a hazardous work practice identified as a result of an incident. Employees were welcome to offer suggestions for inclusion in a safety alert. The "safety first" communication was used by a group or division of RailCorp to provide information to workers and was tailored to a specific workplace or work group. A safety first was communicated to staff by inclusion in monthly team group briefings and was also published on the intranet site. In addition all RailCorp workplaces had safety notice boards to carry a wide variety of safety information to RailCorp workplaces. There were over 100 safety practitioners assisting line managers to fulfil their occupational health and safety responsibilities. In December 2005, RailCorp had implemented a safety knowledge management system being a database housing risk profiles in relation to safety, environment and the RailCorp business generally, performance requirements, safety events and incidents, and, safety actions. The operation of the database was explained by Ms Kitcher.

12 RailCorp had an extensive assurance programme of audits and inspections, including internal, external and regulatory audits. The audit programme verified that the safety management system at all levels had been properly implemented and maintained, verified conformity with regulatory requirements, ensured that safety management systems met RailCorp safety policy including objectives and targets, improved safety performance and reviewed and monitored supply performance. It was said that the RailCorp audits were systematic, independent and documented. Ms Kitcher gave evidence about safety initiatives and programmes and explained the "just culture" programme designed to create an environment seeking out risks and promoting systems improvement through better incident reporting while promoting openness and learning from incidents. This was a behavioural change programme aimed at giving managers the skills to identify behaviours, correct "at risk" behaviour and reinforce positive behaviour, including incident reporting. As at December 2007, over 1700 managers and frontline supervisors had attended a two-day "just culture" workshop about how to support a just culture in the workplace from a safety operations and performance perspective. Approximately 600 additional managers/supervisors were expected to attend workshops that were to be provided later in 2008.

13 There were RailCorp initiatives to address staff health and fitness, including the implementation of a health assessment process for rail safety workers (with more than 4,500 health assessments being conducted in the last 12 months), the development of fatigue management arrangements, the development of an alcohol and other drugs programme (providing not only testing, but also establishing pro active measures communicated internally and externally to contractors to encourage staff to self identify problems and providing for rehabilitation programmes) and the organisation of health fairs and special health events, including free influenza vaccines.

14 In relation to industry generally, RailCorp was said to be actively involved in promoting rail safety principles throughout Australian railways, including its involvement in legislative reform programmes since 2004. RailCorp management had contributed to the Council of Australian Governments National Rail Safety Reform Programme and was a member of the Rail Industry Safety and Standards Board. The Board had been established to write national applicable standards and codes of practice and RailCorp was currently involved in a project to introduce an Australian wide Rule Book based on RailCorp's Rule Book on rail safety. RailCorp was involved in promoting Sydney passenger safety through assisting the State Transit Authority in developing systems for passenger safety by sharing information and advice about RailCorp's systems. The safety promotion was achieved in a number of different ways and involved not only employees but also contractors. These promotions involved a safety convention with the RailCorp Safety Convention winning the National Safety Council of Australia Award for best communication of safety messages in 2006. Approximately 1500 people attended the 2007 Safety Committee Convention. RailCorp held an annual safety competition across the whole organisation to promote a safe and healthy organisational culture. The competition recognised good safety performance. Approximately 800 people attended the competition in November 2007 with approximately 450 employees engaging in various competitions that took place on that day. Once every two years, RailCorp organised for the chairperson of its workplace safety committees to attend a forum aimed at facilitating networking and discussing the operations of such committees. The last forum was held in May 2007 over two days and staff had been encouraged to come forward with safety issues and concerns that could be effectively managed: there had been an increase in reports of safety issues between 2004 and 2007. RailCorp's lost time injury frequency rate had reduced considerably during this period. RailCorp continued to implement lessons learned from the train derailment at Waterfall with 83 of the 88 recommendations requiring RailCorp action by the Special Commission of Inquiry being fully implemented. In 2006 and 2007, RailCorp had received a number of awards recognising its commitment to occupational health and safety. From 2004, RailCorp had spent in excess of $30 million on dedicated safety initiatives and that figure did not include expenditure on ongoing delivery of safety risk controls such as equipment, maintenance and competency training or other operational initiatives or programmes.

15 In relation to the contribution by RailCorp to the community, Ms Kitcher stated that the corporation prided itself on being a good corporate citizen and contributing to the community. In relation to passenger rail safety, RailCorp had developed a programme to educate passengers about the importance of rail safety and the dangers of trespassing and had used a rail accident victim to promote the safety message in the community and in schools. In February 2008 RailCorp, along with the New South Wales Level Crossing Strategy Council, launched a safety education campaign targeting residents living close to railway crossings in the Illawarra and Hunter regions. The Corporation had implemented a "heat smart" promotion to educate passengers on how to travel safely during the summer months and through the "Pram Safety Project" had initiated a change to the national standards for brakes on prams so that it was now a design requirement for pram brakes to automatically engage when the handle was released. In addition, RailCorp was a committed supporter of various community events including Westmead Childrens Hospital Teddy Bears Picnic and annual NAIDOC celebrations. The Corporation supported the New South Wales Railway Band.

16 Mr Nigel Howlett was employed by RailCorp as General Manager, Commercial Renewals and had been employed in the railway industry for 29 years. Mr Howlett had previously been General Manager, Renewals with the RIC and subsequently employed by RailCorp with a title change in 2007 to reflect an increase in portfolio. In his role he was responsible for the supervision of approximately 1200 employees within the Corporation's Asset Management Group. The Assets Management Group was responsible for developing and maintaining the Corporation's infrastructure such as rolling stock, track, communications and control systems, structures, major projects, associated capital works, strategic works and strategic assessment management. In this position, Mr Howlett had overriding responsibility for occupational health and safety across the Commercial Renewals Division. Because of the size of the undertaking he relied on a team to keep him informed on all safety matters and there was a specialised team of 15 staff operated by his Safety and Quality manager. He explained that RailCorp employed a dedicated corporate safety group and he relied upon its advice. The team was led by Ms Kitcher.

17 Approximately 41 rail depots fell within Mr Howlett's area of responsibility. There were heavy plant maintenance depots where activities such as shunting were carried out, quarrying depots where aggregate was loaded on to rolling stock and gang depots where no shunting or rail work was carried out but operated as accommodation depots or provided a base for employees, together with basic storage facilities. Employees usually attended gang depots at the start and finish of their shifts and received team briefings and other communications at the depot site. The Coniston rail depot was a gang depot consisting of an administration building, storage shed and yard. That depot was used to store track related materials and other machinery, including gang trucks to support the Coniston team in delivering track related projects across the Sydney Metropolitan and Illawarra region as part of the Corporation's annual maintenance programme. While the gang's work started and finished at such depots, the majority of work time was spent on various project sites in the Greater Metropolitan and Illawarra area. As at March 2008, there were 33 employees based at the Coniston rail depot. RailCorp engaged labour hire workers and contractors to supplement its workforce and to meet work related demands or specific project requirements. Generally, ten to fifteen supplementary workers may be engaged at the Coniston Depot at any one time depending on the workload. At the date of the accident in May 2005, RailCorp employed approximately 34 people at the Coniston Depot: at the time of the incident four employees and one contractor were engaged in work at the Depot.

18 In relation to the accident, Mr Howlett expressed his deep regret for the incident and stated that he was committed to ensuring that such an incident did not occur again within RailCorp. RailCorp was at all times and continued to be committed to safety and to ensure the safety of employees and non-employees at work. He regarded safety as his number one priority.

19 Mr Howlett set out the duties performed by Mr Coltman as a fettler based at the Coniston Depot and noted that he had been employed by RailCorp or former rail agencies since 2000. Mr Coltman had been issued with a WorkCover Construction Induction Certificate and had completed several formal training courses in relation to the safe operation of plant and safe work systems and 14 such courses were identified in evidence. Mr Coltman's former work experience relating to the railways was also touched upon and Mr Howlett provided the training history of all the employees engaged at the Coniston Depot on the day of the incident.

20 With its wide use of contractors and plant hire, RailCorp had adopted a rigorous selection process. Two plant service managers had been engaged (including Total Plant Services Pty Ltd) and they ordered plant for RailCorp sites as required and ensured that the plant and equipment provided were adequately assessed, registered and that drivers had appropriate competencies where necessary. RailCorp undertook random auditing of the safety of such plant. The Corporation required all workers, including sub-contractors, to comply with its occupational health and safety systems and procedures as if they were employees. The Plant Service Managers, by the terms of their contracts, were required to ensure that employees and sub-contractors selected had the necessary skills, competence and experience to provide the services required and that they could do so with due care and skill.

21 In relation to the plant used on the day of the incident, Total Plant Services Pty Ltd had engaged TKR Contracting Pty Ltd ("TKR") to supply the loader/backhoe and an operator to assist in moving shipping containers at the Coniston Depot. RailCorp had used TKR many times and it was a proven plant provider, especially for the Coniston Depot. Mr Brian Clark was supplied by TKR to drive the loader/backhoe and he was regularly used at the Coniston Rail Depot because of his experience, expertise and the versatility of his machine. Because of that background, TKR was specifically requested by the Plant Service Manager to supply Mr Clark and his machine. At the time of the incident, Mr Clark had approximately 37 years' experience in plant operation. Mr Clark held competencies in A 27 vehicle load crane and C 24 forklift truck MAX 10T as well as front end loader skid steer excavator, front end loader/backhoe and forklift truck certificates. Mr Clark had completed a general occupational health and safety induction for construction work in New South Wales in accordance with the Occupational Health and Safety Regulation 2001 and held a Rail Infrastructure Corporation Induction qualification.

22 The safety management system in operation at the time was explained by Mr Howlett and he emphasised that the system necessitated a risk assessment of the process being undertaken prior to the job being undertaken, and that it be documented in a Safe Work Method Statement for regular repetitive tasks or a Job Safety Analysis for a one-off task. The hazards control identified from this risk assessment should have been briefed to staff at the commencement of a shift in a pre-work briefing. Prior to any work commencing on site, a daily plant inspection should have been carried out and documented. There was a "working safely" toolkit available to employees at the site which was a quick reference guide to common safety procedures and there was also the RIC safety manual.

23 In compliance with the safety management system, a number of steps were taken in relation to the movement of the shipping containers at the Coniston Depot. The Plant Service manager had satisfied himself that TKR had adequate safe work systems for the work task and TKR had in operation its own occupational health and safety policy and a written procedure for changing the attachments to the Volvo EL 70. Mr Clark, on behalf of TKR, completed a pre-job plant inspection checklist and that included a Safe Work Method Statement signed by Mr Clark. As part of its audit processes, RailCorp inspected the loader/backhoe used on the day of the accident on two separate occasions (13 October 2004 and 4 February 2005) to assess its suitability for hire. On both occasions, the plant was deemed suitable and recommended for hire. As part of its annual inspection schedule for its own plant, the RailCorp forklift in operation at the incident was inspected on 28 September 2004. The forklift was serviced in November 2004.
24 Mr Howlett then gave details of the immediate corrective actions taken by RailCorp after the incident. The Corporation's Safety and Quality manager attended the depot with incident management and the use of the forklift and loader/backhoe was suspended. The forklift was not used again until it was checked and confirmed safe for use by consulting engineers. RailCorp required TKR to have its jib inspected and in turn, TKR engaged an external company to inspect the jib and certify that it was satisfactory for use. A risk assessment was conducted by the Depot manager involving two RailCorp safety co-ordinators relating to the task of moving the shipping containers. Before further work was undertaken to move the shipping containers, RailCorp engaged an external company to conduct a structural engineering inspection of the shipping containers to certify that they were structurally sound. As a result a report was supplied and confirmed that the containers to be moved were structurally sound and could be moved by using a side-loading system. RailCorp then made enquiries of specialist contractors as to whether they were able to supply a side-loading system and enquired about their safety systems. RailCorp was satisfied that a specialist contractor, Whytes Heavy Haulage, had the appropriate equipment and safety systems to undertake the work and that company was engaged to move the shipping containers using a Hammer 195 side loading system. A Safe Work Method Statement specific to the task of re-locating the shipping containers was developed by the Depot manager with the assistance of two RailCorp safety co-ordinators.

25 Medium term action taking by RailCorp involved the appointment of dedicated project managers for Depot improvement projects targeted towards occupational health and safety improvements from June 2005; all team leaders, work group leaders and team managers attended a series of safety conventions from July 2005 to July 2006; and within three months of the accident, the team at Coniston Rail Depot led by the Depot manager had an open discussion and consultation session on the way to prevent a recurrence of the incident and incidents generally.
26 After the incident, RailCorp assisted Mr Coltman by referring him for occupational therapy assistance, including daily living skills and home assessment, initial rehabilitation assessment, counselling, medication, return to work assistance, functional capacity assessment and workplace assessment. Mr Coltman was also referred for pre-intervention assessment (being a six-week exercise based programme to increase physical work tolerance and permit a return to pre-injury duties) and workplace strategies in order to reduce spinal stress and the risk of re-injury. RailCorp Track Works manager and Safety and Quality manager visited Mr Coltman at home and during these visits arranged for a plumber to fit an extension to the shower hose in Mr Coltman's bathroom, arranged for physiotherapy treatment to be provided to him, supplied a specialised bed for Mr Coltman and arranged for gardening to be attended to at his home. The day after the incident, Coniston Depot employees were briefed by the Depot manager and a Divisional Safety Co-ordinator regarding the incident and Mr Coltman's welfare as well as the importance of vigilance in the workplace regarding workplace hazards. Employees at the Depot were kept regularly informed about Mr Coltman's condition and well-being and this also occurred at monthly team meetings. The Corporation offered trauma counselling to its employees based at the Depot.

27 Mr Howlett stated that the incident and learning from the incident were communicated to the workforce at the June 2005 Occupational Health and Safety Committee meeting and were communicated to the team as part of the monthly team briefings. In the normal course of work of the Corporation, all incidents were reported and discussed at various forums throughout RailCorp, including at senior levels and this occurred in relation to this incident.

28 Mr Howlett added to the evidence of Ms Kitcher concerning the development of safe systems of work by RailCorp. In speaking of the Corporation's commitment to safety it was noted that, as a result of the accident, significant steps had been taken to improve safety management systems across rail depots. Those steps included the holding of monthly depot safety inspections, the refinement of depot evacuation procedures including practice drills, the introduction of a staff safety hazard reporting system covering all work sites including depots, and, a clear identification and allocation of safety responsibilities including first aiders, fire wardens, depot manager and tool and equipment managers.

29 The safety committees had been re-structured in their operations and responsibilities with the introduction of a peak divisional committee comprising the chairs of all other depot committees and dealing with general and common issues. There were 12 other committees structured along process lines and those processes were identified. Workers were continually reminded to report all workplace hazards, incidents and near misses as a requirement of the Corporation's safety management system and a safety hotline number had been established to assist such reporting. A hazard identified and reported was inserted into the safety management database and allocated a risk profile identifying the period of time in which the hazard must be rectified and identifying a person responsible for that rectification. A hazard not rectified in the nominated time frame proceeded through the management hierarchy. In the Commercial Renewal divisions, there was a 24 hour/7 day "assistance line" staffed by safety professionals giving advice and guidance on safety issues.

30 In dealing with RailCorp safety and induction guidelines, Mr Howlett confirmed evidence given by Ms Kitcher and noted that there was a general induction given to new employees outlining general safety management processes and the safe work method statements and pre-work briefings. Employees, contractors and visitors were to receive a general safety induction and a site-specific safety induction before commencing any work at RailCorp workplaces. The rail industry safety induction covered specific hazards and those inductions were delivered at the training facility located at Petersham. The WorkCover Construction Industry certificate (previously known as "the green card") was mandatory under the Occupational Health and Safety Act and was provided to employees who undertook construction work. There was a job specific induction, also know as pre-work briefings, where employees were taken through the safe work method statements and safe work instructions applying to the work they would be performing, together with any site job specific hazard.

31 In relation to training, Mr Howlett stated that the Corporation had recently completed a competency profile of every employee of the Commercial Renewals Division and identified which of the 41 available training courses were required to be undertaken by each employee. The Corporation was measuring and monitoring progress of training completion and there was currently a 54 per cent completion rate for an overall requirement of 6.500 courses. Mr Howlett also spoke of auditing being carried out at rail depots by internal and external auditors and described how they were carried out within the RailCorp operation. Results of audits were made available to line managers and other relevant personnel with required actions entered into a database for tracking and to secure agreed action to reduce the level of risk as far as practicable.

32 Reference was made in Mr Howlett's evidence of the safety convention aimed to raise awareness of safety issues amongst employees. The Corporate Safety Division in the past few years had conducted a safety convention for key managers and in addition, the Commercial Renewals Division conducted its own safety conventions. A safety recognition programme was part of the safety conventions with nominations for best safety initiatives being submitted by line managers to a central judging committee for consideration. The nominees and the ultimate winner were recognised at the combined safety conventions. RailCorp conducted a safety reward system, rewarding staff teams for positive safety performance. There were other recognition programmes from time to time such that during February and March 2006, the Commercial Renewals Division conducted a depot competition for the best depot with a view to promoting and encouraging depot improvements. The competition results were based on an independent safety audit of all depots by an audit team from Corporate Safety. In addition, the Commercial Renewals Division had commissioned a series of near miss DVDs involving staff who had been involved in near miss incidents in order to raise awareness of issues. The DVDs were presented to staff at team briefings and were available to all RailCorp employees on the intranet. Each team depot, where team briefings were held, had a television and a DVD player available for this purpose. Approximately 1200 employees within the Commercial Renewals Division were required to attend a monthly team briefing where safety was always the first item on the agenda. Mr Howlett briefed his own direct reports and administrative staff while staff at depots were briefed by depot managers. The Division regularly produced a newsletter in which Mr Howlett wrote the editorial and safety was always stressed.

RAILCORP - A PREVIOUS OFFENDER?
33 Since the accident, approximately $928,000 had been spent at Coniston under the RailCorp Trackworks Improvement Project. The improvements included: construction of a new storage facility to replace the shipping containers; a new amenities block including change rooms, meal rooms and toilet block; an upgrade of drainage systems and resurfacing of the entire yard with bitumen; an upgrade of the perimeter fencing; and, a relocation of high voltage cables.

34 After the evidence had been received, an issue of considerable importance arose relating to the prior record of RailCorp and necessitated an adjournment of the proceedings for the matter to be more closely analysed. On resumption of the hearing the prosecutor submitted that having regard to the statutory framework, although RailCorp came into existence in 2004, in relation to its work in the metropolitan rail area, the RIC was a "predecessor" in the metropolitan rail area under s 121(3) of the Occupational Health and Safety Act 2000. This meant that the defendant RailCorp was to be regarded as a previous offender and open to a maximum penalty of $825,000 in relation to this breach. It was common ground that, since coming into existence in 2004, RailCorp had no prior convictions but there were a number of prior convictions committed by the RIC although only two of those convictions (concerning maintenance activities) were submitted to be of relevance to this sentencing process. RailCorp rejected the construction contended for by the prosecutor, submitting that ss 120, 121 and 123 of the Occupational Health and Safety Act 2000 were essentially concerned with successorship. It was submitted that there was nothing in the Transport Administration Amendment (Rail Agencies) Act 2003 that operated to make RailCorp a successor to the RIC and, in particular, nothing that transferred the criminal liability of the RIC to RailCorp.

35 In order to determine this issue, it is necessary to consider the operation of several statutory provisions. The relevant provisions of the Occupational Health and Safety Act 2000 appear to be contained within Pt 7, Division 3 of the Act dealing with proceedings against the Crown and Government Agencies and in particular ss 118, 119, 120, 121 and 123. Those provisions are in the following terms:

SECTION 118 ACT TO BIND THE CROWN

118 This Act binds the Crown in right of New South Wales and, in so far as the legislative power of Parliament permits, the Crown in all its other capacities.

SECTION 119 CRIMINAL PROCEEDINGS AGAINST THE CROWN AND AGENTS OF THE CROWN

119(1) [Prosecution] The Crown in any capacity may be prosecuted for an offence against this Act or the regulations.

119(2) [Penalty notice] The Crown in any capacity may be served with a penalty notice in connection with an alleged offence against this Act or the regulations.

119(3) [Corporation] In the case of an offence against this Act or the regulations committed or alleged to have been committed by an agency of the Crown that is a corporation:

(a) the corporation and not the Crown may be prosecuted for the offence, and

(b) the corporation and not the Crown may be served with a penalty notice.

Note: See section 123 for proceedings against successors of corporate agents of the Crown. The other provisions of this Act relating to corporations apply in respect of proceedings against corporate agents of the Crown.

119(4) [Terminology] For the purposes of this Division, proceedings against the Crown are proceedings to which this section applies (other than those against an agency of the Crown that is a corporation).

(119(5) [State of New South Wales] Proceedings against the Crown in right of New South Wales may be brought or taken under the title “State of New South Wales”.

SECTION 120 RESPONSIBLE AGENCY FOR THE PURPOSES OF PROCEEDINGS AGAINST THE CROWN

120(1) [Terminology] The responsible agency for the purposes of proceedings against the Crown is the agency of the Crown:

(a) whose acts or omissions are alleged to constitute the offence, or

(b) if that agency has ceased to exist-that is the successor of that agency, or

(c) if that agency has ceased to exist and there is no clear successor-that the court declares to be the responsible agency.

120(2) [Specified in charge or penalty notice]. The responsible agency is to be specified in the charge for an offence for which the Crown is prosecuted or in any penalty notice served on the Crown. The responsible agency may, during any proceedings for an offence, be changed by the prosecutor with the leave of the court.

120(3) [Acting for the Crown] The responsible agency is entitled to act for the Crown in proceedings against the Crown.

120(4) [Procedural rights] Subject to any relevant rules of court, the procedural rights and obligations of the Crown as the accused in the proceedings are conferred or imposed on the responsible agency.

120(5) [State-owned corporation] For the purposes of this section, a State owned corporation is taken to be an agency of the Crown in right of New South Wales.

SECTION 121 PENALTIES IN RESPECT OF PROCEEDINGS AGAINST THE CROWN

121(1) [Terminology] In this section, penalty means:

(a) The monetary penalty for an offence against this Act or the regulations, or

(b) the amount payable under a penalty notice served in connection with such an offence, or

(c) the amount payable under an order made under Division 2.

121(2) [Corporation penalty] The penalty in respect of proceedings against the Crown is the penalty applicable in respect of offences committed by a corporation.

121(3) [Previous offender] If that penalty differs for previous offenders, the Crown is a previous offender in relation to particular proceedings against the Crown only if the Crown is a previous offender in respect of the acts or omissions of the same responsible agency of the Crown (or any predecessor of that agency).

121(4) [Enforcing fines] Enforcement proceedings under the Fines Act 1996 cannot be taken in connection with penalties imposed in respect of proceedings against the Crown.

SECTION 123 PROCEEDINGS AGAINST SUCCESSORS OF

GOVERNMENT CORPORATIONS

123(1) [Terminology] In this section, government corporation means:

(a) a corporation that is an agent of the Crown, or

(b) a State owned corporation, or

(c) a corporation that is an area health service or statutory health corporation within the meaning of the Health Services Act 1997, or

(d) a local council or county council, or

(e) a public or local authority that is declared by the regulations to be a government corporation for the purposes of this section.

123(2) [Succession] Proceedings for an offence against this Act or the regulations that were instituted against a government corporation before its dissolution, or that could have been instituted against a government corporation but for its dissolution, may be continued or instituted against its successor if the successor is a government corporation.

123(3) [Government corporation] Subsection (2) extends to proceedings that could have been instituted against a government corporation because of the operation of that subsection.

123(4) [Successor to government corporation] A penalty notice served on a government corporation for an offence against this Act or the regulations or any penalty paid by a government corporation in respect of such a penalty notice:

(a) is taken to be a penalty notice served on its successor if the successor is a government corporation, or

(b) is taken to be a penalty paid by any such successor,

as the case requires.

36 The relevant provisions of the The Transport Administration Amendment (Rail Agencies) Act 2003 are as follows:

Transport Administration Amendment (Rail Agencies) Act 2003 No 96

...

[7] Section 3A

Insert after section 3:

3A Metropolitan rail area

(1) For the purposes of this Act, the

"metropolitan rail area" is the land shown or described as being within the metropolitan rail area on the metropolitan rail area map presented to the Speaker of the Legislative Assembly (by or on behalf of the Member of the Assembly who introduced the Bill for this Act) when the Bill was introduced into the Assembly, and also lodged in the office of the Ministry of Transport, as amended or replaced under this section.

Part 2 RAILCORPORATION NEW SOUTH WALES

Division 1 Constitution of RailCorp as statutory SOC

4 Establishment of RailCorp as statutory State owned corporation

(1) There is constituted by this Act a corporation with the corporate name of RailCorporation New South Wales.

(2) The State Owned Corporations Act 1989 is amended by inserting in Schedule 5, in alphabetical order, the words “RailCorporation New South Wales”.

Note: The State Owned Corporations Act 1989 contains many provisions that apply to RailCorp as a statutory State owned corporation. In particular, Part 3 contains provisions relating to their status, the application of the Corporations Act 2001 of the Commonwealth, the issue of shares to the Treasurer and another Minister, the board of directors, the chief executive officer, the employment of staff, the giving of directions by the portfolio Minister (including directions as to the performance of non-commercial activities or the carrying out of public sector policies), the memorandum and articles, tax-equivalent payments, government guarantees, the sale or disposal of assets and legal capacity. Part 4 deals with the accountability of State owned corporations (including annual reports and accounts). Part 5 deals with miscellaneous matters (including the duties and liabilities of directors and the application of public sector legislation).

Division 2 Objectives of RailCorp

5 Objectives of RailCorp

(1) The principal objectives of RailCorp are:

(a) to deliver safe and reliable railway passenger services in New South Wales in an efficient, effective and financially responsible manner, and

(b) to ensure that the part of the NSW rail network vested in or owned by RailCorp enables safe and reliable railway passenger and freight services to be provided in an efficient, effective and financially responsible manner.

(2) The other objectives of RailCorp are as follows:

(a) to maintain reasonable priority and certainty of access for railway passenger services,

(b) to promote and facilitate access to the part of the NSW rail network vested in or owned by RailCorp,

(c) to be a successful business and, to that end:

(i) to operate at least as efficiently as any comparable business, and

(ii) to maximise the net worth of the State’s investment in the Corporation,

(d) to exhibit a sense of social responsibility by having regard to the interests of the community in which it operates,

(e) where its activities affect the environment, to conduct its operations in compliance with the principles of ecologically sustainable development contained in section 6 (2) of the Protection of the Environment Administration Act 1991 ,

(f) to exhibit a sense of responsibility towards regional development and decentralisation in the way in which it operates.

(3) The other objectives of RailCorp are of equal importance, but are not as important as the principal objectives of the corporation.

(4) Section 20E of the State Owned Corporations Act 1989 does not apply to RailCorp.

Division 3 – Functions of RailCorp

6 Railway passenger services

(1) RailCorp is to operate railway passenger services.

(2) RailCorp is to continue to operate the railway passenger services which were provided by the State Rail Authority immediately before the commencement of this section.

(3) Subsection (2) does not limit the power of RailCorp:

(a) to establish any new railway passenger service, or

(b) to alter or discontinue any of its railway passenger services.

(4) The operation of a railway passenger service by RailCorp is subject to the requirements of the Rail Safety Act 2002 .

7 Rail infrastructure functions

RailCorp is to hold, manage, maintain and establish rail infrastructure facilities vested in or owned by it on behalf of the State.

Note: Schedules 6A and 6B (see section 98) contain provisions relating to the rights and liabilities of rail infrastructure owners.

8 Metropolitan rail area access functions

RailCorp is to provide persons with access under any current NSW rail access undertaking to the part of the NSW rail network vested in or owned by RailCorp.

Note: As a rail infrastructure owner, RailCorp may enter into rail access undertakings in relation to that part of the NSW rail network that is vested in it or that it owns. Section 99C and Schedule 6AA contain general provisions relating to rail access.

9 Other transport services

RailCorp may operate other transport services, including bus services, whether or not in connection with its railway services.

10 Other functions of RailCorp

(1) RailCorp has the functions conferred or imposed on it by or under this or any other Act or law.

(2) RailCorp may:

(a) provide goods, services or facilities to the rail industry, and

(b) without limiting paragraph (a), act as an agent for or provide services to another rail infrastructure owner or rail operator, whether or not the agency or services are for purposes related to its principal functions, and

(c) conduct any business (whether or not related to its principal functions) that it considers will further its objectives, and

(d) provide services or facilities that are ancillary to or incidental to its principal functions.

(3) RailCorp may, with the consent of the Minister, act as an agent for a body constituted under this Act (other than the State Transit Authority, the Roads and Traffic Authority or the Independent Transport Safety and Reliability Regulator) without obtaining the consent of that body.
PART 2B Rail Infrastructure Corporation

[10] New Part 2B

Omit Division 1 and the heading to Division 2.

[11] Section 19D Objectives of RIC

Omit "NSW rail network" wherever occurring in section 19D(1) and (2)(a).

Insert instead "part of the NSW rail network vested in or owned by Rail Infrastructure Corporation"

...

Division 1 Definitions

89 Definitions

In this Part:

"rail authority" means RailCorp, Rail Infrastructure Corporation, Transport Infrastructure Development Corporation or any other person or body prescribed by the regulations.

"railway system" has the same meaning as it has in Part 2A.

"State rail operator" means RailCorp or any other person or body prescribed by the regulations.

...

94 Transfers of assets, rights and liabilities

(1) The Minister may, by order in writing, direct that the assets, rights or liabilities of a specified rail authority, or any subsidiary of a rail authority, that are specified or referred to in the order, be transferred to another rail authority, a subsidiary of a rail authority, a State owned corporation, the Crown or any other person or body acting on behalf of the Crown.

(2) The Minister may, by further order under this section, further direct the transfer any assets, rights or liabilities previously transferred under this section.

(3) An order under this section may be subject to specified terms and conditions.

(4) Schedule 4 applies to the transfer of assets, rights and liabilities under this section.

(5) Words and expressions used in this section have the same meanings as they have in Schedule 4.

(6) In this section:

"rail authority" includes the State Rail Authority, the Transport Administration Corporation, the Director-General and any other person or body prescribed by the regulations.

95 Transfer of staff

Schedule 6 has effect.

...

[79] Schedule 6, clauses 11A–11D

Insert after clause 11:

11A Transfer of SRA staff and RIC staff to RailCorp

(1) The Minister may, by order in writing, provide that such SRA staff as are specified or described in the order are transferred to RailCorp.

(2) The Minister may, by order in writing, provide that such RIC staff as are specified or described in the order are transferred to RailCorp.

(3) A person who is the subject of an order under this clause is taken for all purposes as having become an employee of RailCorp, in accordance with the terms of the order, on the day specified in the order.

11B Transfer of SRA staff and RIC staff to Transport Infrastructure Development Corporation

(1) The Minister may, by order in writing, provide that such SRA staff as are specified or described in the order are transferred to Transport Infrastructure Development Corporation.

(2) The Minister may, by order in writing, provide that such RIC staff as are specified or described in the order are transferred to Transport Infrastructure Development Corporation.

(3) A person who is the subject of an order under this clause is taken for all purposes as having become an employee of Transport Infrastructure Development Corporation, in accordance with the terms of the order, on the day specified in the order.

11C Transfer of RailCorp and TIDC staff to SRA

(1) The Minister may, by order in writing, provide that such RailCorp staff as are specified or described in the order are transferred to the SRA.

(2) The Minister may, by order in writing, provide that such Transport Infrastructure Development Corporation staff as are specified or described in the order are transferred to the SRA.

(3) A person who is the subject of an order under this clause is taken for all purposes as having become an employee of the SRA, in accordance with the terms of the order, on the day specified in the order.

11D Transfer of RailCorp and TIDC staff to RIC

(1) The Minister may, by order in writing, provide that such RailCorp staff as are specified or described in the order are transferred to RIC.

(2) The Minister may, by order in writing, provide that such Transport Infrastructure Development Corporation staff as are specified or described in the order are transferred to RIC.

(3) A person who is the subject of an order under this clause is taken for all purposes as having become an employee of RIC, in accordance with the terms of the order, on the day specified in the order.

...

[87] Schedule 6A, clauses 2-2E

Omit clause 2. Insert instead:

2 Ownership of country rail infrastructure facilities

(1) This clause applies to rail infrastructure facilities situated in the country rail area.

(2) RIC is the owner of all rail infrastructure facilities installed in or on land, in or on rivers and other waterways and in or on the beds of rivers and waterways by RIC and of all rail infrastructure vested in or transferred to RIC (whether or not the place on which the facilities are situated is owned by RIC).

(3) This clause is subject to any interest of Transport Infrastructure Development Corporation in rail infrastructure facilities.

2A Ownership of rail infrastructure facilities in metropolitan rail area

(1) This clause applies to rail infrastructure facilities situated in the metropolitan rail area.

(2) RailCorp is the owner of all rail infrastructure facilities installed in or on land, in or on rivers and other waterways and in or on the beds of rivers and waterways by RailCorp and of all rail infrastructure facilities vested in or transferred to RailCorp (whether or not the place on which the facilities are situated is owned by RailCorp).

(3) This clause is subject to any interest of Transport Infrastructure Development Corporation in rail infrastructure facilities.

2B Provisions relating to vesting of rail infrastructure facilities in RailCorp

(1) On the commencement of this clause (the transfer day), the rail infrastructure facilities (and any associated assets, rights and liabilities) situated in the metropolitan rail area and vested in or owned by RIC immediately before the transfer day (the metropolitan rail infrastructure facilities) are vested in RailCorp.

(2) On the transfer day, the following provisions have effect:

(a) all proceedings relating to the metropolitan rail infrastructure facilities commenced before the transfer day by or against Rail Infrastructure Corporation or a predecessor of Rail Infrastructure Corporation and pending immediately before the transfer day are taken to be proceedings pending by or against RailCorp.

(b) any act, matter or thing done or omitted to be done in relation to the metropolitan rail infrastructure facilities before the transfer day by, to or in respect of Rail Infrastructure Corporation is (to the extent that that act, matter or thing has any force or effect) taken to have been done or omitted by, to or in respect of RailCorp.

(c) a reference in any Act, in any instrument made under any Act or in any document of any kind to Rail Infrastructure Corporation is, to the extent that it relates to the metropolitan rail infrastructure facilities, but subject to the regulations, to be read as or including a reference to RailCorp.

...

[184] Schedule 7

...

References to SRA

(1) Except as provided by the regulations, a reference in any Act, in any instrument made under any Act or in any document of any kind to the State Rail Authority is, to the extent that it relates:

(a) to the metropolitan rail area or the exercise of functions relating to railway passenger services in this State, to be read as or including a reference to RailCorp, or

(b) to its responsibility for network control, to be read as or including a reference to the person having responsibility for the network control under this Act, or

(c) to the development of a railway system or other transport project undertaken by Transport Infrastructure Development Corporation under section 18E (2), to be read as or including a reference to Transport Infrastructure Development Corporation.

(2) This clause has effect subject to any transfers of assets, rights or liabilities under this Act.

...

Schedule 2 Amendments relating to dissolution of Rail

Infrastructure Corporation

[1] Long title

Omit "Rail Infrastructure Corporation”.

[2] Section 3 Definitions

Omit the definition of "Rail Infrastructure Corporation" from section 3 (1).

[3] ...

[4] Section 89 [as inserted by the Transport Administration

Amendment (Rail Agencies) Act 2003]

Omit "Rail Infrastructure Corporation” from the definition of rail authority .

[5] Section 122 Definitions

Omit “, RIC” from the definition of rail authority .

[6] Part 9, Division 8

Insert after Division 7:

Division 8 Dissolution of Rail Infrastructure Corporation

129 Dissolution of Rail Infrastructure Corporation

Schedule 9 has effect.

[7] ...

[8] ...

Schedule 9 Dissolution of Rail Infrastructure Corporation

1 Dissolution of Rail Infrastructure Corporation and subsidiaries

(1) Rail Infrastructure Corporation, and each Rail Infrastructure Corporation subsidiary, are dissolved and any assets, rights and liabilities of the Corporation and any subsidiary become assets, rights and liabilities of the Crown.

(2) Section 94 and Schedule 4 apply to the assets, rights and liabilities vested in the Crown under this clause in the same way as they apply to the assets, rights and liabilities of a rail authority.

(3) Despite subclause (2), the Minister may not transfer an asset, right or liability vested in the Crown under this clause, except with the concurrence of the Treasurer.

(4) Part 3 (including clauses 11, 11A (2) and 11B (2)) of Schedule 6 applies to any staff of the Rail Infrastructure Corporation immediately before the dissolution.

(5) Regulations of a savings and transitional nature may be made consequent on the dissolution of the Rail Infrastructure Corporation and any subsidiary of the Corporation.

(6) This clause is subject to clause 4.

2 ...

3 Provisions relating to vesting of rail infrastructure facilities in RailCorp

(1) On the dissolution of Rail Infrastructure Corporation (the transfer day), the rail infrastructure facilities (and any associated assets, rights and liabilities) vested in or owned by RIC immediately before the transfer day (the country rail infrastructure facilities ) are vested in RailCorp.

(2) On the transfer day, the following provisions have effect:

(a) all proceedings relating to the country rail infrastructure facilities commenced before the transfer day by or against Rail Infrastructure Corporation or a predecessor of Rail Infrastructure Corporation and pending immediately before the transfer day are taken to be proceedings pending by or against RailCorp.

(b) any act, matter or thing done or omitted to be done in relation to the country rail infrastructure facilities before the transfer day by, to or in respect of Rail Infrastructure Corporation is (to the extent that that act, matter or thing has any force or effect) taken to have been done or omitted by, to or in respect of RailCorp.

(c) a reference in any Act, in any instrument made under any Act or in any document of any kind to Rail Infrastructure Corporation is, to the extent that it relates to the country rail infrastructure facilities, but subject to the regulations, to be read as or including a reference to RailCorp.

(3) The Minister may, by order in writing, declare that a specified right, asset or liability is not vested in RailCorp by the operation of this clause.

(4) The operation of this clause, is not to be regarded:

(a) as a breach of contract or confidence or otherwise as a civil wrong, or

(b) as a breach of any contractual provision prohibiting, restricting or regulating the assignment or transfer of the country rail infrastructure facilities, or

(c) as giving rise to any remedy by a party to an instrument, or as causing or permitting the termination of any instrument, because of a change in the beneficial or legal ownership of the country rail infrastructure facilities.

(5) Words and expressions used in this clause have the same meanings as they have in Schedule 4.

37 In dealing with these provisions, s 20F of the State Owned Corporations Act 1989 is of relevance and is in the following terms:

20F Status of statutory SOCs

A statutory SOC or any of its subsidiaries:

(a) is not and does not represent the State except by express agreement with the voting shareholders of the SOC, and

(b) is not exempt from any rate, tax, duty or other impost

imposed by or under any law of the State merely because it is a SOC, and

(c) cannot render the State liable for any debts, liabilities or obligations of the SOC or any of its subsidiaries,

unless this or any other Act otherwise expressly provides.

38 The last background document of relevance is the Second Reading Speech on the introduction of the Occupational Health and Safety Bill by the Attorney-General in May 2000. The Second Reading Speech deals with a number of matters but the following extract deals with the background to the introduction of what became Pt 7, Division 3 dealing with proceedings against the Crown and Government Agencies and embracing what is now ss 118 - 123 inclusive:

Occupational Health and Safety Bill Second Reading Speech 26/05/2000

... The bill contains two additional provisions clarifying government liability for occupational health and safety. These arose in the context of proceedings taken against government agencies rather than from workplace safety report recommendations. The important point is that the amendments ensure that prosecutions can be undertaken when they are warranted.

One amendment clarifies that the responsible agency is entitled to act for the Crown in any enforcement proceedings. That agency will be the agency for the determination and payment of any penalty. The second amendment enables proceedings to be taken against the successor of a government corporation when the successor is also a government corporation. This will ensure that a change in the corporate make up does not interfere with the protection of employees via appropriate prosecutions. By way of background, in an innovatory way, the 1983 legislation expressly bound the Crown and its agencies to give effect to occupational health and safety standards. That was an important reform at the time and we are extending and refining that provision in this bill.

39 In view of the time the parties have devoted to the issue of RailCorp's prior record, if any, and the fact that the proceedings were adjourned to allow this issue to be further considered, it is appropriate to commence with a consideration of that issue.

40 There was no question that RailCorp was a State owned corporation and that by the operation of ss 119 and 120 of the Occupational Health and Safety Act 2000 that RailCorp was an agency of the Crown that was a corporation and as such it was the corporation (and not the Crown) that was to be prosecuted. Further, RailCorp under s 120 was "the responsible agency" whose acts or omissions were alleged to constitute the offence and thus Railcorp was to be specified in the charge. It is to be noted that, for the purposes of s 120 by sub-section 5, a State owned corporation was taken to be an agency of the Crown in Right of New South Wales.

41 In relation to s 123, senior counsel for RailCorp submitted that it had no application to the present proceedings because these proceedings for an offence against the Occupational Health and Safety Act 2000 did not concern a government corporation that had been dissolved as the RIC was still in existence and continued to operate, albeit in a reduce area of operation. The offence was not one committed by the RIC that needed to be "saved" by the operation of s 123 because the RIC had been dissolved and had been replaced by a successor government corporation. No issue was taken in relation to that submission and it appears to be an accurate description of the operation of s 123 in the circumstances of this case. Senior counsel for RailCorp, however, advanced the suggestion that these provisions were cognate provisions and as such dealt with the related notion of a succession on the one hand or pre-decessorship on the other hand. Approached in that way, RailCorp was not a successor to any government corporation because the RIC had not been dissolved and therefore the RIC could not be a predecessor to RailCorp. The force of that submission might be undermined by the presence of Schedule 2 in the Amendment Act inserting a new Schedule 9 dealing with the dissolution of the RIC and its subsidiaries. However, this part of the Amendment Act has not yet come into force, many years after the other provisions became operative.

42 What then is to be made of the provisions of s 121? Counsel for the prosecutor submitted that its operation was straightforward and on its face, applied to the present circumstances. The penalty in respect of proceedings against the Crown was the penalty applicable in respect of offences committed by a corporation, namely, RailCorp. Section 121(3) applied because that penalty against RailCorp differed for previous offenders and that different penalty applied "only if the Crown is a previous offender in respect of the acts or omissions of the same responsible agency of the Crown (or any predecessor of that agency)". RailCorp had been in existence since 2004 operating the metropolitan rail area, once operated by RIC but since the commencement of the Amendment Act no longer operated by RIC: for the purposes of s 121 (3), RIC was therefore the "predecessor" of RailCorp in relation to that part of the operation.

43 The interaction of the provisions of Part 7, Division 3 of the 2000 Act need to be considered against the history of the operation of the 1983 Act and the difficulties thrown up when statutory corporations were restructured within government agencies or were dissolved and the functions handed to new entities, including government agencies. This history was briefly, but specifically, alluded to in the Attorney General's Second Reading Speech when he stated that the new provisions "arose in the context of proceedings taken against government agencies". It has long been accepted that it may be possible to discern the intention of the legislature not only by inference after an examination of the legislation as a whole and that sometimes it can be discerned only by reference to the history of the legislation and the state of the law when it was enacted (see Saraswati v The Queen [1991] HCA 21; (1990) 172 CLR 1 per McHugh J at 21; see also Shorten v David Hurst Constructions Pty ltd [2008] NSWCA 134).

44 In October 1998, Hungerford J dealt with an unusual situation in WorkCover Authority of New South Wales (Inspector Gilbert) v Energy Australia (formerly Sydney Electricity) (1998) 85 IR 99. Those proceedings had a long history and ultimately a guilty plea was entered by the defendant to a single offence but during the course of the sentence hearing, an issue arose about the defendant's prior convictions. The defendant, Energy Australia, had no prior convictions but the prosecutor sought to rely on the earlier convictions of its predecessor, Sydney Electricity, being the original defendant and on the record of Sydney Electricity's predecessor, Sydney County Council. It had been agreed that Energy Australia was a statutory corporation incorporated under the Sydney Electricity Act 1990 and that the staff, assets and liabilities of Sydney Electricity were transferred in 1995 to MetNorth Energy which was also a statutory corporation incorporated under the Electricity Act 1945. In March 1996, MetNorth Energy became incorporated under the Energy Services Corporation Act 1995 and in March 1996 the name of MetNorth Energy was changed to Energy Australia. Ultimately his Honour decided that, while the assets and liabilities of the predecessors had been transferred to the defendant Energy Australia, on a proper construction of the transitional provisions only the civil liability of the predecessors had been transferred and the criminal liability had not been clearly transferred and thus, Energy Australia had to be found not guilty of the charge.

45 In that case, Sydney Electricity had been dissolved by Statute and although certain liabilities of the former Sydney Electricity had been transferred to Energy Australia as a separate legal entity, Energy Australia was the result of an amalgamation of several different entities and was not merely a name change. Hungerford J dealt at length with the complex legislative provisions that brought into existence the various bodies referred to and dissolved others. Of some significance was the fact that Sydney Electricity continued to exist for some time after the transfer order to MetNorth 1 took effect and later was formally dissolved.

46 In this complex legislative web, Hungerford J started by adhering to the ordinary rule that, on the dissolution of a defendant statutory corporation to a criminal charge, the charge abated and effectively lapsed: there would be no continuing legal entity in existence against which the proceedings could be maintained. His Honour noted that, where the legislature created a successor statutory corporation, the question of whether any criminal liability of the former body was assumed by the new body would depend upon the terms of the Statute affecting the dissolution of one and the creation of the other. If the legislature, by express enactment, provided that the original and the successor bodies were one and the same legal person, then it would follow that an undetermined criminal charge against the former would continue against the latter unaffected by the fact that the former was indeed dissolved (at 113). His Honour noted that, by transferring the assets, rights and liabilities on dissolution, the legislature had made appropriate provision of a transitional nature for civil matters but certainly did not expressly or by necessary implication transfer matters of a criminal nature: this was so even though the word "liability" was apt to embrace both criminal responsibility and civil responsibility. The transitional provisions involved in the establishment of Energy Australia concerned the transfer of only civil liabilities and disclosed no statutory intention to transfer criminal liability.

47 In relation to the statutory scheme before his Honour, Hungerford J stated:

The statutory scheme, as I have viewed it, in respect of the relationship between Sydney Electricity and MetNorth 1 simply does not constitute in any way MetNorth 1 as the same legal person as Sydney Electricity. Indeed, ... , the fact Sydney Electricity continued as a corporation, even after MetNorth 1 was incorporated and the transfers from Sydney Electricity effective on 1 October 1995 until it was dissolved by the Electricity Supply Act on 1 March 1996, is cogent support for the view that the legislature did not intend MetNorth 1 to be the successor to Sydney Electricity for any criminal liability, but rather there would be a mere transfer of Sydney Electricity staff, assets, rights and liabilities to it without making the two bodies the same legal person.

48 It is of some interest that Hungerford J recorded a public policy submission made by the prosecutor in Energy Australia, a submission made in the following terms:

It is also submitted that it would not be supportive of good public policy if statutory corporations because of changes in their history, such as the history of Sydney Electricity set out above, could walk away from liability under a statute set up by the same Parliament with the intention "to secure the health, safety and welfare of persons at work ..." (Occupational Health and Safety Act). That Act has existed since 1983 and it is submitted that it is unlikely in the extreme that Parliament intended that liability under it would simply abate if a corporation set up by Statute went through changes related to the evolution of electricity policy in New South Wales (at 111).

Of this submission, Hungerford J stated:

That may well be a desirable result, but it is a result which only the legislature can achieve and, to adopt what was said by Deane J in Fowler v Taylor [1957] VR 593 (at 595), in words "clearly so stated" (at 116 - 117).

49 While dealing with the issues that arose in Energy Australia, Hungerford J referred to his earlier judgment in Workcover Authority of New South Wales (Inspector Rech) v Sydney Market Authority (1997) 82 IR 134. In that matter, a prosecution had been brought against the Sydney Market Authority for a breach of the Occupational Health and Safety Act 1983 in circumstances where the defendant, pursuant to the provisions of the Sydney Market Authority Act 1968, had been constituted as a statutory corporation representing the Crown. The Sydney Market Authority (Dissolution) Act 1977 provided for the sale of the business undertaking of the Sydney Market Authority and provided that the Authority would dissolve immediately after the sale date. On such dissolution the assets, rights and liabilities (if any) of the Authority became the assets, rights and liabilities of the Crown. Sydney Market Authority (Dissolution) Act 1977 once proclaimed would immediately dissolve the Authority and it would cease to exist and therefore the charges against the defendant, if not disposed of by the sale date, would abate and effectively lapse as there would be no defendant to meet them.

50 In this case there was a sale to a statutorily approved purchaser, Sydney Markets Ltd, and the regime, unlike the case involving Energy Australia, did not involve any transfer of assets or liabilities to another statutory or State corporation. Because of this factor, no question arose as to a statutory successor to the Authority and there were no statutory transitional provisions to consider in order to establish whether the criminal liability of the Authority had been transferred to the new statutory corporation. In this case, the prosecution could not be dealt with before the Authority was dissolved and so the charges lapsed.

51 At the time of the Attorney General's Second Reading Speech on the introduction of the Occupational Health and Safety Act 2000, Hungerford J's decisions in Sydney Market Authority and Energy Australia represented the law in relation to the application of the Occupational Health and Safety Act 1983 on the dissolution of statutory corporations and what might happen to their criminal liability. It is against this background that the Attorney General in his Second Reading Speech stated, so far as is relevant to the present argument:

... the Bill contains two additional provisions clarifying Government liability for occupational health and safety. These arose in the context of proceedings taken against Government agencies rather than from workplace safety report recommendations. The important point is that the amendments ensure that prosecutions can be undertaken when they are warranted.

... The second amendment enables proceedings to be taken against the successor of a government corporation when the successor is also a government corporation. This will ensure that a change in the corporate makeup does not interfere with the protection of employees via appropriate prosecutions. By way of background, in an innovatory way, the 1983 legislation expressly bound the Crown and its agencies to give effect to occupational health and safety standards. That was an important reform at the time and we are extending and refining that provision in this field;

52 It appears that the clarification being introduced by the enactment of Part 7, Division 3 of the 2000 Act was that, where a statutory corporation was the successor to another statutory corporation, there would no longer be a need to scrutinise transitional and other provisions to see if there was a clearly expressed intention to transfer the criminal liability from the previous corporation to the successor Crown corporation. Once there was successorship and the prior agency ceased to exist, s 120 operated so that the responsible agency for the purpose of proceedings against the Crown was the successor agent of the Crown and it was to be the responsible agency for purposes of prosecutions under the 2000 Act. Section 120(1)(c) covered the position where the Crown agency ceased to exist and there was no clear successor, leaving it to the Court to declare what Crown agency would be the responsible agency - a provision that, at least, seems to cover the position where the previous Crown agency is disaggregated and divided amongst two or more agencies.

53 To bring about this result, Part 7, Division 3 of the 2000 Act commences with s 118 repeating the previous provision of the 1983 Act namely, that the Occupational Health and Safety Act binds the Crown in Right of New South Wales. The Division then addresses what agency will be responsible for penalties and what agencies may be proceeded against for breaches of the Act. The Division proceeds upon the basis of identified responsible agencies (being the agencies actually responsible for the breach) rather than looking to the Crown generally and in particular, looking at the breach history of the responsible agency rather than the Crown generally: this approach reverses the view expressed in WorkCover Authority of New South Wales (Inspector Tuckley v The Crown in Right of the State of New South Wales (Department of Community Services) (1999) 96 IR 1 and later, with respect to Hungerford J, wrongly continued in Inspector Keelty v Crown in Right of the State of New South Wales (Police Service of NSW) (No 3) (2002) 112 IR 144 where it was held that the Court was concerned not only with the convictions of the identified responsible Department but for the purposes of sentencing, all prior convictions of the Crown were relevant. Importantly, Division 3 makes these provisions by looking at responsible agencies and successor/predecessor agencies.

54 Section 121 deals with penalties with respect to proceedings against the Crown. By s 121(2), the penalty in respect of proceedings against the Crown is designated to be the penalty applicable in respect of offences committed by a corporation. Such a corporation is an agency of the Crown that is a corporation under s 119. Section 121(3) then operates such that if the penalty differs for previous offenders, the Crown is a previous offender in relation to particular proceedings against the Crown, only if the Crown is a previous offender in respect of the acts or omissions of the same responsible agency of the Crown. In this way, the 2000 Act makes it clear that a Crown agency with a clear record will not be a prior offender under the Act merely because some other agency of the Crown is a prior offender: the specific agency must be the prior offender when subsequently charged under the 2000 Act and only its record, not that of the Crown generally, is relevant for sentencing purposes. It is in this context that a savings provision is inserted so that a Crown agency will be a prior offender where it has no prior offences but where the predecessor agency did have a criminal record. The reference to "predecessor" in s 121(3) is to be read in the context of the operation of the whole of Part 7, Division 3: that Division focuses upon successors such that a predecessor Crown agency has that status where the existing Crown agency is the successor of that previous, dissolved, Crown agency. The word "predecessor" appearing as it does as a saving provision in s 121(3) does not alter the nature of Part 7, Division 3 of the 2000 Act dealing with successorship.

55 The operation of s 121 in Part 7, Division 3, therefore, is concerned with Crown agencies that are dissolved and replaced by successor Crown agencies. This combination of dissolution and successorship is used consistently in Division 3: s 121 does not address the position of a newly created Crown agency (such as RailCorp) where previously created Crown agencies (still in existence) operated the service now operated by that newly created Crown agency. For the operation of Division 3 the question will be whether or not, after dissolution of the previous agency, the newly created Crown agency was intended by the legislature to be the successor of the dissolved agency. This is not an unusual approach: it will be recalled that in Energy Australia, Hungerford J held that there was no successor (and for the purposes of this case, therefore no "predecessor") where the previous Crown agency continued to exist and where there had been no more than a transfer of staff and assets from the previous agency to the newly created agency. This is an apt description of the operation of the Amendment Act creating RailCorp.

56 Approached in this way, the provisions of the Transport Administration Amendment (Rail Agencies) Act 2003 have to be considered to ascertain if, in a relevant sense, RailCorp was created as a successor of the RIC. There is force in the defendant's submission that RailCorp was not the successor to the RIC when both Crown agencies continued to operate after the passing of the Amendment Act (even though provision is made for the ultimate dissolution of the RIC but that has not yet occurred). As already mentioned, the continued operation of the earlier agency was a significant factor in Hungerford J holding that Energy Australia was not the successor of Sydney Electricity. Under s 4 of the Amendment Act, RailCorp was established as a statutory State Owned Corporation. Under s 6 its functions included the continued operation of railway passenger services that were provided by the State Rail Authority immediately before the commencement of the section. In Schedule 6, Clause 11A was inserted permitting the Minister by order in writing to transfer SRA staff and the RIC staff to RailCorp. Under Schedule 7 a reference in any Act or any instrument under any Act or in any document of any kind to the State Rail Authority, to the extent that it related to the Metropolitan Rail Area or the exercise of functions relating to rail passenger services in the State, was to be read as including a reference to RailCorp.

57 Under Schedule 9 dealing with the dissolution of the RIC, it is only on the dissolution of that body that any assets, rights and liabilities become the assets, rights and liabilities of the Crown. Further, on the dissolution of the RIC, the rail infrastructure facilities and any associated assets, rights and disabilities vested in or owned by RIC immediately before the transfer day are to be vested in RailCorp and on the transfer day, all proceedings relating to CountryRail infrastructure facilities commenced before the transfer day by or against the RIC or a predecessor of the RIC and pending immediately before the transfer day are taken to be proceedings pending, by or against, RailCorp. This provision makes it clear that, until the dissolution of the RIC, RailCorp is not its successor.

58 A consideration of these provisions show that firstly, on the prosecutor's approach to construction, SRA and the RIC might be considered predecessors to RailCorp. This is a complication for the prosecutor's argument dealt with further in para [60]. Secondly, it is clear that the legislative intention is that RailCorp was to be established as a separate legal entity with the RIC and SRA to continue although provision was made for their ultimate dissolution. It was only upon the dissolution of the RIC that any liability was to be transferred to RailCorp. Until that occurs, RailCorp is not intended to be a successor to the RIC and the RIC is not a predecessor for the operation of s 121(3) of the Occupational Health and Safety Act 2000.

59 The prosecutor's argument also looked at the usual meaning of the terms "successor" and "predecessor". The Australian Legal Dictionary (Butterworths, 1997) defines "successor corporation" as:

a corporate entity that has succeeded a predecessor corporation, and which may be held liable in certain circumstances for the tortious acts or omissions, including product liabilities, of the predecessor.

The Macquarie Dictionary (3rd Edition) defines "successor" as:

1. one who or that which succeeds or follows;

2. one who succeeds another in office, position, or the like

To the extent that the prosecutor relies upon these general definitions to ascertain the meaning of the word "predecessor", he appears to treat the word "successor" in the 2000 Act as involving no more than a Crown agency being created and undertaking at least some of the functions that were once only undertaken by a previously created Crown agency. As earlier concluded, that loose, or colloquial use of the word "successor" is not borne out by a careful reading of Part 7, Division 3: in this Division of the Act, the word "successor" is consistently used to refer to a new Crown agency replacing a dissolved Crown agency. The word "predecessor" is used in the Division to refer back to the successor provisions and their operation - it is not intended to introduce an entirely new notion encompassing something wider than a successor replacing a dissolved agency. This approach is further confirmed by the terms of s 121(3) in referring to "the predecessor of that agency": the legislature has not used the term "predecessor" loosely but has required that, in the present case, RIC is to be the predecessor of RailCorp for s 121(3) to apply. The fact that RailCorp took over a number of functions of RIC, and in that loose sense became the successor of RIC in relation to those functions, did not result in RailCorp becoming the successor corporation to RIC because RIC, as a corporation, continued to operate.

60 It may be thought that this construction is too narrow but it reflects the words used in the Division. Where there is no dissolution of a previous Crown agency but some of its functions are transferred to a newly created Crown agency, whether or not the criminal liability of the previous agency is transferred to the new agency will be determined by the content of the enabling legislation (for example, in Inspector Wong v Clarence Valley Council [2006] NSWIRComm 250, there was a dissolution of a number of Councils on the day that the newly created Council came into existence - the Proclamation specified that the transferred liabilities included "liabilities relating to criminal acts").

61 Some curious results follow if s 121(3) operates in the manner contended for by the prosecutor. One odd result is that the RIC (and probably the SRA) would remain a previous offender in relation to offences within the area now designated as the metropolitan rail area as well as being a previous offender in relation to any such offence after the commencement of the Amendment Act, if that offence occurred within the same type of area of operation (but now excluding the metropolitan rail area operated by RailCorp). It is true that the RIC could be a previous offender in relation to a number of other operations having nothing to do with RailCorp and thus be subjected to the higher penalty regime but there might be some consideration given to the seriousness of the offence if it occurred in relation to the same type of operations that had been conducted in the metropolitan rail area prior to the Amendment Act: otherwise this fact is of no relevance to the present discussion. The odd result (and seemingly an unintended result) would be that, in relation to the same previous offence or a number of such offences, two or more existing Crown agencies would be treated as prior offenders and subject to the higher penalty regime: that is, they would share this part of the criminal record, a novel concept indeed.

62 Against this proposition counsel for the prosecutor suggests that if the approach argued for by the prosecutor is not adopted, then the purpose of the provisions of Part 7, Division 3 of the Occupational Health and Safety Act 2000 would be rendered nugatory where the Government chose to transfer all the assets of an existing government corporation to a newly established government corporation but left the original corporation as a shell, legally still in existence but with no work to perform. In this scenario there is no dissolution of the original government corporation and therefore no successor and the new government corporation would be entitled to be treated as a first offender, even though the previous corporation had a record or even a very bad record. So long as the original government corporation remained a shell without any work to perform it could never again be in breach of the Occupational Health and Safety Act 2000 and its prior record would never come under consideration while the new government corporation that had, in substance, taken over all of the assets including the staff of the original government corporation would, nevertheless, be entitled to be treated as a first offender when in substance it was the successor of the original government corporation.

63 Although it is accepted that frequently the operation of a provision can be tested by the consequences of its application (see Cole v Director General, Department of Youth and Community Services and anor (1987) 7 NSWLR 541 at 546 per Kirby P; Dreyfus (Camille and Henry) Foundation Inc v Inland Revenue Commissioners [1956] AC 39; Inland Revenue Commissioners v Plummer [1980] AC 896, although note the caution to attend this approach, eg. Esso Australia Resources Ltd v FTC [1998] FCA 1655; (1998) 83 FCR 511 at 518-19) there are some aspects of the prosecutor's argument that do not meet the utility of that time honoured test. In the scenario put forward by the prosecutor, if the legislature decided that it did not wish the criminal record of a particular government corporation to be attached to a newly established government corporation, then it would be at liberty to do so by specifically providing for such an operation in the enabling Act establishing the new government corporation. The operation of Part 7, Division 3 of the Occupational Health and Safety Act 2000, in such circumstances, would be approached as a general provision that was set aside by the specific and contrary provision found in the later enabling Act: that approach would be an uncontroversial application of the maxim generalia specialibus non derogant, namely that general words or provisions do not derogate from special words or provisions.
64 After the Court reserved its judgment, an issue of clarification of the function performed by RIC after RailCorp came into existence was raised with the parties. The Court sought some brief additional evidence about the nature and scope of the work of RIC immediately after the creation of RailCorp and the transfer of certain assets and staff to Railcorp. Unfortunately, this request resulted in the parties becoming entangled in disagreements as to the appropriate way in which to respond. A further mention of the proceedings did not resolve the issue. Ultimately, the Court withdrew its request for further evidence: the issue of RailCorp's prior convictions was able to be fully considered on the material submitted by the parties during the course of the hearing

THE PLEA CONSIDERED
65 Having determined the major issue between the parties and having found that RailCorp is to be treated as a first offender, the facts relevant to the plea are then to be considered. The defendant RailCorp through its senior counsel readily accepted that this was a serious offence. This was a relatively simple task of moving a large and heavy container from one part of the Coniston depot to another, nevertheless, the defendant's failures were numerous. Although adopting the RIC's safety management system at the Coniston rail depot the manual was not followed at the site and, in any event, did not contain a Safe Work Method Statement for performing this task. It is to be noted that in the Statement of Agreed Facts the use of jib attachments to drag and push items was recognised by the defendant as a source of risk prior to the accident. At the time of the accident, neither the RIC manual or RailCorp's safety management system referred specifically to the task of relocating shipping containers at the depot and in addition, there were no documented instructions or directions for the relocation of the container. There was no formal, documented risk assessment or safe method of work developed for the relocation of the container. Further, it was agreed that Mr Milgate and Mr Coltman were effectively performing dogmen functions in relation to the relocation of containers but neither was certified to perform those functions although both had completed the relevant training. It was also agreed that the use of the forklift to lift one end of the container was an inappropriate use of that plant for that purpose. There was no pre-work meeting held at which the work methods to be used were discussed or steps taken to address the risks associated with the work. There is force in the prosecutor's submissions that the entire work procedure adopted on that day was, at best, "ad hoc".

66 This is a case where relatively simple and straightforward steps could have been taken to address the risks involved in moving the containers. The adoption of proper planning of the work, conducting a risk assessment and using the appropriate machinery and attachments for this work were all obvious and available methods for the performance of the task. The actions of the defendant after the accident, demonstrate the steps that could easily have been taken: RailCorp suspended the use of the forklift and the loader/backhoe, engaged a specialist contractor who ultimately advised moving the containers by using a Hammer side loading system and then developed a Safe Work Method Statement for this task and conducted pre-work briefings. All of these matters confirm the defendant's concession that this was, indeed, a serious breach of the Act.

67 There was no resistance to the concept of general deterrence playing a significant role in the setting of an appropriate penalty. In relation to specific deterrence it is accepted that the defendant, RailCorp, employs a large number of people and engages a number of contractors and operates a number of facilities, including depots, in what is a heavy and inherently dangerous industry. Admittedly, it comes before the Court without any prior convictions in a relatively short life but where its operations are large scale and operating 24 hours a day, seven days a week. It is important that the defendant acted promptly to address the risks that were exposed in performing this task of moving containers at the depot and subsequently adopted safety procedures to eliminate that risk as well as engaging experts to address the structural soundness of the containers. It is also accepted that there were significant safety systems already in operation that had refined and improved the safety systems that had operated under the RIC although those systems did not address the performance of this task. The prosecutor accepted that Parliament had taken extensive steps to address short comings in the occupational health and safety systems previously operating in the State's rail industry as part of the restructuring of government agencies and corporations charged with the administration and conduct of transport services, including the creation of the defendant and accepted that development was relevant to the issue of specific deterrence. Having regard to these matters and while specific deterrence will play a role in the setting of an appropriate penalty, there will be a reduced role for the concept of specific deterrence.

68 In relation to subjective factors, it is accepted that after the matter was listed on the return of the summons, the matter was adjourned to allow further particulars to be supplied and at an early stage thereafter the defendant entered a plea of guilty to the charge as particularised in the summons. That response constitutes an early plea and it is appropriate in this case that a discount of 25 per cent be allowed for that factor. As already indicated, the defendant is to be regarded as first offender and is entitled to the benefit of leniency in recognition of that status although that status arises in relation to a relatively short period of operation but, as already noted, an operation that involves the employment of large numbers of people over many operations in a heavy industry that is inherently dangerous. The prosecutor accepted that there was co-operation with the WorkCover Authority during the investigation of the accident and that is an important consideration. There is also evidence of contrition and accepting responsibility for the accident given by Mr Howlett who formally expressed the sorrow of the defendant for the cause of the accident and gave details of the assistance provided to Mr Coltman and the provision of trauma counselling for all employees based at the Coniston depot. The incident and "learnings" from the accident were communicated to the workforce at the occupational health and safety committee meeting following the accident and were communicated to the team as part of the monthly brief. The accident was also reported in various forums throughout the defendant including at senior levels. The evidence otherwise showed the defendant to be a good corporate citizen, supporting community charities. These matters will all be considered in mitigating the seriousness of the penalty.

69 Having determined that the defendant should be convicted of the offence, mention needs to be made of a Victim's Impact Statement prepared by Mr Coltman and submitted by the prosecutor.

That statement noted Mr Colman's injuries as: "lower back injury, thoracic back, head, right knee, depression/anxiety" and attached five medical reports. Those reports dealt with the course of treatment of Mr Colman's injuries and stated that he was in hospital for five days and absent from work for approximately eight months before returning to work on light duties. While initially able to return to full duties, he continues to suffer discomfort and restrictions in normal movement. His injuries were described as "significant" and his recovery was described in one recent report as being "excellent" with a 5% whole person impairment (although earlier reports assessed a higher level of impairment). The Court is better informed as to the consequences of this accident by having received and considered Mr Coltman's Victim's Impact Statement. That document brings home to the defendant, and to those who read the judgment, the consequences for those often horrifically injured in workplace accidents and the need to be vigilant in ensuring a safe work environment.

ORDERS
70 Having regard to the matters mentioned above, the Court makes the following orders:

1. The defendant is found guilty of a breach of s 8(1) of the Occupational Health and Safety Act 2000 as particularised in Matter No IRC 550 of 2007, to which the defendant entered a plea of guilty.

2. The defendant is fined the sum of $120,000 with half that amount to be paid to the prosecutor by way of moiety.

3. The defendant is to pay the costs of the prosecutor in a sum agreed or, in the absence of agreement, as ordered by the Court.

ANNEXURE

AGREED STATEMENT OF FACTS

1. The prosecutor is an Inspector duly appointed under Division 1 of Part 5 of the Occupational Health and Safety Act, 2000 and empowered under section 106(1)(c) of the said Act to institute proceedings in the within matter.

2. At all material times, RailCorporation New South Wales (“RailCorp”) of 18 Lee Street Chippendale in the State of New South Wales was constituted as a statutory state owned corporation pursuant to the Transport Administration Amendment (Rail Agencies) Act 2003.

The charge
3. The alleged offence under section 8(1) of the Act is as follows:

On 18 May 2005 at 10 Old Springhill Road at Coniston in the State of New South Wales (“the depot”), the defendant, being an employer, failed to ensure the health, safety and welfare at work of all its employees, and in particular, Glenn Coltman, contrary to section 8(1) of the Act.
4. The particulars of the charge are that the defendant:

(a) failed to ensure that the systems of work for the relocation of shipping containers in and about the site were safe.

(b) failed to ensure that the plant used in the relocation of shipping containers on the site was properly used, such as to not expose persons to risk of injury.

(c) failed to provide such information and instruction as was necessary to ensure that the task of relocating shipping containers was done without exposing persons to risk of injury.

Background

5. At all material times, the defendant was a statutory state owned corporation.

6. At all material times, the defendant operated premises at 10 Old Springhill Road, Coniston in the State of New South Wales as a RailCorp depot (“the depot”).

7. At all material times, the defendant was an employer and employed persons working at the depot.

8. At all material times, Steve Olsen, Glenn Coltman, Wallace Cook and Stephen Milgate were employees of the defendant.

9. At all material times Steve Olsen was employed as a “team leader” with responsibility for the supervision of Coniston Production 2 and 3 (work gangs) and the work associated with relocation of shipping containers at the depot. Mr Olsen was not present on the day of the subject incident. Mr Wallace Cook was acting in a supervisory capacity on that day.

10. At all material times the defendant contracted Total Plant Services Pty Ltd ABN 43 104 635 369 (“Total Plant Services”) as a “plant supply manager”. As a plant supply manager, Total Plant Services managed the supply of plant and equipment to the defendant for work on the defendant’s rail network and associated works, including works in the defendant’s depots.

11. At all material times, TKR Contracting Pty Ltd (“TKR”) was contracted by Total Plant Services to supply the defendant with a Volvo EL 70 loader/backhoe, and plant operator, Mr Bryan Clark, to perform work at the depot.

12. At all material times, TKR was an employer and employed Mr Clark to operate the Volvo EL 70 loader/backhoe at the depot.
Incident of 18 May 2005

13. On or prior to 18 May 2005, Steve Olsen gave directions to Mr Wallace Cook that a number of shipping containers were to be relocated within the depot.

14. In accordance with Mr Olsen’s directions, the shipping containers were to be moved from the eastern boundary fence of the depot to an area adjacent to the western boundary, which had been previously cleared for that purpose.

15. One of the shipping containers to be relocated was a 40-foot shipping container, bearing the markings MW05000, with an approximate weight of 4 tonnes (“the Container”). The Container was empty.

16. Mr Cook instructed Mr Clark and two RailCorp employees, Glenn Coltman and Stephen Milgate, to relocate the Container.

17. In accordance with instructions provided by Mr Olsen, Mr Cook instructed Mr Clark to use TKR’s Volvo BM EL 70 loader/backhoe ("the Loader") to drag the Container from between two other containers.

18. In accordance with Mr Cook’s instructions, Mr Clark attached the jib attachment to the Loader. Investigations after the incident indicate that, when Mr Clark attached the jib to the loader, the pins used to secure the jib to the loader did not engage. As a consequence, the jib was not positively secured. The jib attachment weighed approximately 340 kg.

19. Mr Coltman was then instructed by Mr Cook to get lifting chains from the shed. Stephen Milgate then attached the chains to the jib attachment and the hooks were placed in the front bottom lugs of the Container. Once the chains were in place, Mr Clark reversed the Loader into the centre of the yard dragging the Container out from between two other containers. Mr Clark then continued to reverse the Loader dragging the container around in an arc until the front of the container was facing towards the front gates of the depot.

20. The chains were then disconnected from the front bottom lugs of the Container by Mr Coltman and the Loader was moved to the rear end of the container. Mr Coltman then attached the chains to the bottom lugs at the rear of the Container. Once the chains were in place, Mr Clark then attempted to move the end of the Container by dragging it around with the Loader, but the front right wheel of the Loader was hard up against the Container.

21. At this time, the jib was across the top of the Container and the chains were across the end of the Container.

22. Mr Clark lowered the end of the Container with a view to disconnecting the chains and moving the Loader away from the Container so as to release the front right wheel of the Loader from the side of the Container. The hook at the end of one of the chains was jammed under the end of the Container.

23. During this time, a forklift driven by Mr Cook was used to lift one end of the Container in an effort to allow Mr Coltman to release the chains.

24. Mr Coltman moved to a position between the Loader and the forklift to remove the chain hooks from the bottom of the Container.

25. While the forklift was lifting one end of the Container, the jib attachment on the Loader was dislodged from the jib, fell and struck Mr Coltman on the head.

26. Mr Coltman then fell to the ground under the weight of the jib attachment. Mr Coltman sustained serious head, back and knee injuries as a result.

27. Mr Clark reversed the Loader and then rendered assistance. Mr Cook and Mr Milgate also rendered first aid assistance to Mr Coltman.

28. Mr Cook instructed Paolo Filipe, another RailCorp employee working at the site, to call an ambulance.
Systems of work prior to the incident

29. During the course of the investigation, workers involved in the subject incident and other employees at RailCorp made reference to both the Rail Infrastructure Corporation (RIC) Safety Management System and the RailCorp Safety Management System.

30. Neither the RIC nor the RailCorp Safety Management Systems referred specifically to the task of relocating shipping containers at the site. There were no documented instructions or directions for the relocation of the Container. All instructions provided in relation to this task were verbal and indicated that two containers were to be relocated on 18 May 2005.

31. There was no formal, documented risk assessment or safe method of work developed for the relocation of the Containers.

32. Mr Milgate and Mr Coltman were, in effect, performing dogman functions in relation to the relocation of the container. However, neither was certified to perform the functions of a dogman, although both had completed the relevant training.

33. Further, use of jib attachments to drag and push items was recognised as a source of risk prior to the subject incident.

34. The use of the forklift to lift one end of the Container was an inappropriate use of that item of plant.
Steps taken after the incident

35. After the incident, Inspector Lancaster attended the site and compiled a factual inspection report, taking notes and several photographs. Inspector Lancaster served a number of notices. These notices were a combination of Improvement and prohibition notices.
36. After the incident, RailCorp took measures including the following:
(a) the use of the forklift and Loader were suspended;

(b) the forklift was not used again until it was checked and confirmed safe for use by RK Findlay Pty Ltd, consulting engineers;

(c) before further work was undertaken to remove the shipping containers, RailCorp engaged Jon Tiernan of Civil & Structural, to conduct a structural engineering inspection of the shipping containers to certify that the containers were structurally sound. Mr Tiernan's report confirmed that the containers to be moved were structurally sound and could be moved by using a side loading system;

(d) RailCorp engaged specialist contractor, Whytes Heavy Haulage to move the shipping containers using a Hammer 195 side loading system;

(e) RailCorp developed a safe work method statement specific to the task of relocating the shipping containers;

(h) a pre-work briefing was held prior to the removal of the container by Whytes Heavy Haulage.

37. In addition, TKR had its jib inspected by All-Ways Rigging Gear.

38. Whytes Heavy Haulage then removed the container using a Hammer 195 side loading system.

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LAST UPDATED:
7 October 2008