Inspector Jamie Hinton v Rayming Pty Limited [2010] NSWIRComm 129 (17 September 2010)

Last Updated: 1 October 2010

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION :
Inspector Jamie Hinton v Rayming Pty Limited [2010] NSWIRComm 129



FILE NUMBER(S):
IRC1153, 1152

HEARING DATE(S):
26 July 2010

DATE OF JUDGMENT:
17 September 2010

PARTIES:
Inspector Hinton (Prosecutor)
Rayming Pty Limited (Defendant in IRC1153 of 2009)
Ming Xue Chen (Defendant in IRC1152 of 2009)


CORAM:
Kavanagh J


CATCHWORDS: Occupational Health and Safety Act 2000 - Prosecution under s10(1) of a corporation and by virtue of s 26(1) under s 10(1) of the director of the corporation - company sells and distributes glass and mirror products (imported from China) - goods stored and kept at the premises awaiting sale and distribution - no risk assessment of storage area - no systems, no proper equipment, no signage, no safe storage of goods with great weight - foreseeability - offences most serious - general and specific deterrence relevant - obvious steps that could have been taken - high risk to the safety - few subjective elements balancing the seriousness of the offences - pecuniary status of both defendants - sentencing - penalty

LEGAL REPRESENTATIVES
Mr R Reitano of counsel (Prosecutor)
WorkCover Authority of NSW
Mr L Fermanis of counsel (Defendants)
Berrigan Doube Lawyers

CASES CITED:
Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610
Ferguson v Nelmac Pty Ltd (1999) 92 IR 188
Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch’ng) (1999) 90 IR 464
Markarian v R [2005] HCA 25; (2005) 228 CLR 357
Morrison v Powercoal Pty Limited [2003] NSWIRComm 416; (2003) 130 IR 364
R v Gallagher (1991) 23 NSWLR 220
R v Thomson; R v Houlton (2000) 49 NSWLR 383
R v Way [2004] NSWCCA 131; (2004) 60 NSWLR 168
WorkCover Authority of New South Wales (Inspector Ch'ng) v ACI Operations Pty Limited, unreported decision of Schmidt J, 25 February 1994

LEGISLATION CITED:
Occupational Health and Safety Act 2000


TEXTS CITED:




JUDGMENT:

- 20 -

INDUSTRIAL COURT OF NEW SOUTH WALES

CORAM: Kavanagh J

Friday 17 September 2010

Matter No IRC 1153 of 2009
INSPECTOR JAMIE HINTON v RAYMING PTY LIMITED
Prosecution under s10(1) of the Occupational Health and Safety Act 2000


Matter No IRC1152 of 2009
INSPECTOR JAMIE HINTON v MING XUE CHEN
Prosecution under s10(1) by virtue of s26(1) of the Occupational Health and Safety Act 2000

JUDGMENT

[2010] NSWIRComm 129

1 These prosecutions are brought by Inspector Jamie Hinton of the WorkCover Authority of New South Wales against Rayming Pty Limited (the corporate defendant) under s 10(1) of the Occupational Health and Safety Act 2000 (the Act) and Ming Xue Chen (the individual defendant) under s 10(1) by virtue of s 26(1) of the Act, by way of a Further Amended Application for Order filed 8 April 2010. Mr Chen was the sole director and sole employee of the corporate defendant, Rayming Pty Limited.

2 It is alleged in matter No. IRC1153 of 2009, the corporate defendant on 28 August 2007 contravened s 10(1) of the Act in that it failed to:

ensure that the premises were safe and without risks to health contrary to s10(1) of the Occupational Health and Safety Act 2000 (NSW).

The following particulars were provided:

a) In these particulars “glass” means either pallets containing approximately 25-30 glass panes measuring approximately 1.2 metres by 2 metres weighing 1.8 tonnes in total or individual glass panes of the same dimensions weighing approximately 0.72 tonnes each;

b) The defendant failed to restrict access to parts of the premises where glass was stored;

c) The defendant did not undertake a risk assessment to identify any hazards or hazard control measures associated with the handling or storage of glass at the premises;

d) The defendant did not ensure that mechanical lifting equipment was used at all times that glass was moved so as to minimise the handling of glass by people at the premises;

e) The defendant did not ensure that glass being removed from “A” frames at the premises was only removed once any other glass being stored on the “A” frames had been securely fastened to the “A” frames by the use of restraints;

f) The defendant did not ascertain the safe work load of “A” frames used to store glass at the premises;

g) The defendant did not assess the weight of glass stored on “A” frames at the premises so as to ensure that the safe work load of the “A” frames was not exceeded;

h) The defendant did not ensure that chock wedges were fixed to all “A” frames at the premises so as to ensure that glass stored on “A” frames at the premises was not over balanced;

i) The defendant failed to provide instruction and training to ensure that people at the premises who were not trained, experienced or appropriately skilled did not:

i) Access areas in which glass was stored; or

ii) Handle glass.

j) The risk posed at the premises was the risk of glass falling onto people who were at the premises. Mr Zhu’s death was a manifestation of that risk.

3 It is alleged in matter No. IRC1152 of 2009, the individual defendant on 28 August 2007 contravened s 10(1) by virtue of s 26(1) of the Act in that it failed to:

ensure the premises were safe and without risks to health contrary to s10(1) of the Occupational Health and Safety Act 2000.

The following particulars were provided:

a) In these particulars “glass” means either pallets containing approximately 25-30 glass panes measuring approximately 1.2 metres by 2 metres weighing 1.8 tonnes in total or individual glass panes of the same dimensions weighing approximately 0.72 tonnes each;

b) The corporation failed to restrict access to parts of the premises where glass was stored;

c) The corporation did not undertake a risk assessment to identify any hazards or hazard control measures associated with the handling and storage of glass at the premises;

d) The corporation did not ensure that mechanical lifting equipment was used at all times that glass was moved so as to minimise the handling of glass by people at the premises;

e) The corporation did not ensure that glass being removed from “A” frames at the premises was only removed once any other glass being stored on the “A” frames had been securely fastened to the “A” fames by the use of restraints;

f) The corporation did not ascertain the safe work load of “A” frames used to store glass at the premises;

g) The corporation did not assess the weight of glass stored on “A” frames at the premises so as to ensure that the safe work load of “A” frames was not exceeded;

h) The corporation did not ensure that chock wedges were fixed to all “A” frames at the premises so as to ensure that glass stored on “A” frames at the premises was not overbalanced;

i) The corporation failed to provide instruction and training to ensure that people at the premises who were not trained, experienced or appropriately skilled did not:

i) Access areas in which glass was stored; or

ii) Handle glass

j) The risk posed at the premises was the risk of glass falling onto people who were at the premises. Mr Zhu’s death was a manifestation of that risk.

4 Each defendant pleaded guilty to the charge.

5 Mr R Reitano of Counsel, appeared for the prosecution and Mr L Fermanis, of Counsel, appeared for the defendants. The prosecution relied upon a Statement of Agreed Facts, Photographs, Factual Inspection Reports, an Improvement Notice and the Prior Conviction Record of the company.

6 Mr L Fermanis, of Counsel for the defendants relied upon an affidavit of Ming Xue Chen (also known as Stephen Chen, the defendant) affirmed 5 July 2010, an affidavit of Owen Tam affirmed 15 July 2010 and an affidavit of Shufen Zhou, Restaurant Floor Manager, affirmed 5 July 2010. A number of relevant documents were attached to the affidavits including documents in relation to the investigation of the incident.

7 The Statement of Agreed Facts relevantly reads as amended:

2. Rayming Pty Limited (Rayming) (ACN 120 235 412) was a corporation with its registered office situated at Unit 111, 10 Webb Street, Croydon, in the State of New South Wales.

3. At all material times Ming Xue Chen (Mr Chen) was the sole director and sole employee of Rayming and worked in the Rayming business operating its business out of premises located at 39A George Street, Granville, in the State of New South Wales (premises).

4. Rayming’s business was the sale and distribution of glass and mirror products. The products were imported from China and stored and kept at the premises awaiting sale and distribution (the business).

5. The premises were owned by Omar Kali (Mr Kali), a sole trader who operated under the business name of OK Glass Services.

6. There was no formal lease agreement between Rayming and Mr Kali relating to Rayming’s use of the premises. The agreement was that rent would be paid monthly and after a year the parties would see if the arrangement between them was working out.

The Incident

7. On or about 25 August 2007, Mr Chen attended to his friend’s (Ms Shufen Zhou) home. On this occasion Ms Shufen Zhou notified Mr Chen that she knew an individual who was seeking employment (Mr Zhu) and asked Mr Chen if he required anyone to assist him with his business. Mr Chen informed Ms Shufen Zhou that his business was becoming increasingly busy and he was considering employing an assistant. Later that day, Mr Chen called Ms Shufen Zhou and told her to tell Mr Zhu to come to his business premises on Tuesday.

8. Sometime between 25 to 27 August 2007, Ms Shufen Zhou had a telephone conversation with Mr Zhu whereby she informed him that her friend (Mr Chen) was considering hiring an individual and if Mr Zhu was looking for employment, she recommended him to attend to the premises.

9. On 28 August 2007 Yun Feng Zhu (Mr Zhu) attended the premises unannounced for a “meet and greet” with Mr Chen. Mr Zhu had not met or had any prior contact with Mr Chen but rather Mr Zhu attended to the premises as he had been told by Ms Shufen Zhou that Mr Chen needed someone to assist him.

10. Mr Zhu told his flatmate, Shengchun ‘Philip’ Huang (Mr Huang), that he (Mr Zhu) would be paid the same amount for the work he was doing for Rayming as he was paid for work he had done at his part-time employment at Best BBQ Chinese Restaurant, which was ten dollars an hour.

11. Since Mr Chen had not had any prior contact with Mr Zhu and he did not discuss the details of employment or the expected salary of the position with Ms Shufen Zhou, Mr Chen does not know why Mr Zhu anticipated employment at Rayming or why Mr Zue anticipated earning ten dollars an hour if he was employed by Rayming.

12. On the morning of 28 August 2007, Mr Chen and Mr Zhu introduced themselves to one another and Mr Chen explained to Mr Zhu that Rayming required an employee who could perform heavy lifting. Mr Chen then proceeded to ask Mr Zhu what experience Mr Zhu had in the glass industry or a related industry which required heavy lifting. Mr Zhu notified Mr Chen that he did not have any relevant experience in the glass industry and that he had not done any heavy lifting in his previous employment.

13. After discovering Mr Zhu did not have any experience in the industry and had not performed heavy lifting in the past, Mr Chen informed Mr Zhu that he was not a suitable candidate for the position at Ramying. On this occasion Mr Zhu requested Mr Chen to give him a chance and to try him out. Since Ms Shufen Zhou had referred Mr Zhu to him, Mr Chen showed Mr Zhu around the premises and allowed him to observe him whilst he performed his work because Mr Chen did not feel comfortable telling him to leave the premises straight away.

14. At approximately 11.00 am, Mr Chen left the factory for about two hours. Mr Zhu insisted in having an opportunity to demonstrate his capabilities to Mr Chen when Mr Chen returned. Although Mr Chen had already informed Mr Zhu that he was not a suitable candidate for employment with Rayming, Mr Zhu insisted that he would wait for Mr Chen to return so they could have further discussions about his opportunities to be employed by Rayming. Before Mr Chen departed he informed Mr Zhu to wait for him in his office until he returned. Whilst Mr Chen was out of the factory, Mr Zhu did not remain in the office but entered into the factory on his own accord and began cleaning up rubbish by himself.

15. At approximately 2:00pm on 28 August 2007, when Mr Chen returned, Mr Chen explained to Mr Zhu the process of delivering glass to his customers by demonstrating the process of moving glass.

16. Mr Chen approached a steel “A” frame upon which a pallet of glass panes and individual glass panes were stored. The pallet contained approximately 25-30 glass panes that measured approximately 1.2 meters by 2 meters. The pallet of glass individual glass panes weighed approximately 1.8 tonnes.

17. The “A” frame was made of steel. It consisted of 2 steel beams that formed an “A” shape at each end that were joined by steel cross beams and a bottom foot beam upon which the glass rested.

18. Mr Chen disassembled the pallet by cutting the metal straps around the wooden frame using metal shears and removing nails from the wooden frame using a claw hammer. Once the wooden frame had been disassembled the panes of glass were ready to be removed from the pallet.

19. Once the pallet was disassembled, Mr Chen lifted one glass pane out of the pallet at a time by using his fingers to leverage the top glass pane against the remaining glass panes to enable Mr Chen to have enough room to grasp the top glass pane with the intent of carrying the top glass pane to another location.

20. Mr Chen then told Mr Zhu to pay attention to the glass because it is sharp and that the glass could cut his hands. Since Mr Zhu was anxious to demonstrate his capabilities to Mr Chen and because Mr Zhu had been referred to him by his friend, Mr Chen proceeded to provide Mr Zhu with a pair of gloves so that Mr Zhu could assist him with moving the glass panes.

21. Mr Chen and Mr Zhu then proceeded to carry one glass pane from the pallet situated on the steel “A” frame and placed it onto another steel “A” frame.

22. Mr Chen and Mr Zhu moved approximately 10 panes of glass from the pallet on the steel “A” frame to another steel “A” frame.

23. After moving the abovementioned 10 glass panes, Mr Zhu was visibly exhausted from moving the glass and sat down to take a break. On this occasion Mr Chen notified Mr Zhu again that he was not suitable for a position at Rayming. Mr Chen and Mr Zhu then proceeded into the office situated at the back of the premises where Mr Chen finalised some paperwork with respect to glass products which Mr David Choue was collecting and Mr Zhu sat in the office with Mr Chen and was having a drink.

24. At about the same time Mr David Choue, a production manager employed by Aluminium Glass Technology Pty Limited (AGT), arrived at the premises and parked his truck in the driveway. Mr Choue was collecting a mirror that AGT had ordered from Rayming. At this time Mr Chen was waiting for Mr Choue to come into the premises to collect his mirror. Mr Chen then asked Mr Zhu to wait for him in the office until he had finished serving Mr Choue and afterwards he would drive him to the train station since it was the end of the business day. Mr Chen then left the office and proceeded to greet Mr Choue while Mr Zhu remained in the office taking a break and finishing his drink. Based on the evidence, it appears Mr Zhu had stood up from his seat in the office to see what Mr Chen was doing. On this occasion it appears Mr Zhu noticed Mr Chen was waiting for Mr Choue to assist him with moving the mirror to Mr Choue’s motor vehicle so Mr Zhu left the office and offered to assist Mr Chen with carrying the mirror to Mr David Choue’s motor vehicle. Mr Chen accepted Mr Zhu’s assistance. Mr Chen and Mr Zhu then proceeded to carry the mirror out to the Mr David Choue’s motor vehicle where it was loaded onto the motor vehicle by Mr Choue. Mr Chen then told Mr Zhu to wait in the office and Mr Chen continued to talk to Mr Choue outside of the premises in the proximity of Mr Choue’s motor vehicle. Mr Zhu went back inside the premises.

25. Mr Shou Shen ‘David’ Ge (Mr Ge) was also inside the premises at the time. He was a customer of Rayming who traded as W.G. Kitchen Cabinet Making. Mr Ge purchased glass and mirror products from Rayming from time to time. On 28 August 2007, Mr Ge arrived at the premises at about 3.20 pm. He intended to buy a mirror and repair a door that he had brought with him that contained a broken mirror. As he was finishing this work he proceeded to take his tools to his motor vehicle which was parked outside. To his right, Mr Ge observed that Mr Zhu was unpacking the pallets of glass and was shaking the wooden frame holding the glass panes together. Mr Ge thought that Mr Zhu was trying to loosen the frame because he was pulling at the wooden frame. When Mr Ge returned to the premises to collect his remaining tools which were inside the premises, he saw glass from the pallet on the steel “A” frame which Mr Zhu had been previously shaking fall forward from the steel “A” frame in Mr Zhu’s proximity. Mr Ge rushed forward towards the steel “A” frame in an attempt to hold the glass up so as to stop it from falling onto Mr Zhu. Mr Ge was unable to stop the glass from falling and it continued to fall onto Mr Zhu.

26. Mr Zhu was trapped between approximately 25-30 panes of glass (approximately 1.8 tonnes) and the steel “A” Frame (see paragraphs 30 and 31 below for dimensions). Mr Ge called out for help and attempted to lift the glass off Mr Zhu. Mr Chen and Mr Choue both ran to where Mr Ge was attempting to lift the glass and tried to assist him. Mr Chen, Mr Choue and Mr Ge all tried to separate the glass panes one by one to lean it against the steel “A” frame but the glass continued to fall back down because there were pieces of glass obstructing the panes of glass from remaining upright on the steel “A” frame. Mr Zhu was trapped between the steel poles of the “A” fame and the glass that had fallen. Some people who were outside the premises were called in to assist them but the individuals who were present were not able to lift the glass off Mr Zhu. Police and ambulance were called to attend the premises. When ambulance officers arrived they were unable to resuscitate Mr Zhu.

27. Detective Senior Constable Jacklyn Devlin’s opined, based on the evidence obtained from Mr Ge, that the pallet of glass had falled as a result of the deceased attempting to move the glass unassisted.

28. Detective Senior Constable Jacklyn Devlin’s opined, based on the evidence available to her at the time of her statement, there was nothing to suggest that the actions of anyone, other than Mr Zhu, caused the glass to fall and as soon as witnesses were alerted to the accident, all steps were taken in an attempt to free Mr Zhu.

The Premises

29. On 29 August 2007, Inspector Hinton and Inspector Wayne James attended the premises and made observations contained in Factual Inspection Reports dated 3 September 2009 and 6 September 2009 respectively. A copy of Inspector Hinton’s Factual Report is Annexure “A.” A copy of Inspector James’ Factual Report is Annexure “B”.

30. The Inspectors observed that the premises were comprised of a single storey brick factory building. Inside the premises there was a mezzanine floor on the right hand side that went from the front of the building to the back. Inside the roller door there was a stand that consisted of a green metal base with vertical “C” channel posts/legs. The base was covered with six vertical post pegs spaced along the length of each side and there was cross-bracing between the verticals on each end of the racking. The racking measured approximately 1.5 metres high by 1.21 metres wide by 2.48 metres long at the base with the “C” channel frame made from 45 millimetre thick and 80 millimetre wide channelling. On the top of the racking base was what appeared to be MDF board covering. The spacing between each vertical post/peg from the end where the glass sheeting was leaning on the racking to the roller door end of the base were between 1 – 2 gaps of 400 millimetre; 2 – 3 gap of 390 millimetre; 3 – 4 gap of 390 millimetre; 4 – 5 gap of 390 millimetre; 5 – 6 gap of 615 millimetre. The distance between the top was only different between posts 1 and 2 on each side of the rack. They measured approximately 155 millimetres gap on the wall side between 1 – 2 on the fork lift side was a gap of 270 millimetres. There was a flat rubber strip on the flat side of the “C” channel posts/pegs and length of wood inside the “C” channel on the other side of the channel. Between the verticals 1 – 2 there were 14 glass panels and between 2 – 3 there were 10 glass panels.

31. The “A” frame rack was made from “C” channel that measured approximately 95 millimetres high by 100 millimetres wide. The cross-bracing was made from “C” channel that measured approximately 55 millimetres high by 75 millimetres wide and was painted green. The “A” frame legs measured approximately 1.8 metres long and the “A” frame measured approximately 400 millimetres wide at the base and was in the centre of the leg. The “A” frame was at 1.54 metres high from the floor and was 80 millimetres wide at the top. There were two cross-bracings of small channels between the “A” frame verticals at each end of the “A” rack, one at 320 millimetres in height and one at 740 millimetres in height . The “A” rack was approximately 2.2 metres long with legs and the “A” frame at each end and “A” in the centre of the length. There was cross-bracing of small channels at 400 millimetres height, 750 millimetres high and 1.3 millimetres high. The top of each leg and the “A” frame verticals had strips of 10 millimetres thick flat rubber attached. The steel “A” frame was level at the time of inspection.

32. On 29 August 2007 Inspector Wayne James attended the premises and took photographs of the premises. A copy of the photographs is Annexure “C”.

33. In the course of the investigation, Inspector Hinton asked Mr Chen to produce documents relating to any risk assessments that had been conducted in respect of the premises or the work being done at the premises and none were produced. Mr Chen notified Inspector Hinton that he did not have any documents relating to any risk assessments with respect to the premises or the work being done at the premises because Mr Chen was the sole employee and director of Rayming.

34. The Inspector also sought documents to be produced evidencing an occupational health and safety management system, the systems of work that were applied at the site, training and induction records for employees and others visiting the premises and any records relevant to Mr Zhu and the work he was undertaking at the premises. There were no relevant documents produced. Mr Chen notified Inspector Hinton that he did not have any of the abovementioned documents because he was the only employee of Rayming and he was the only individual carrying out work at the premises, notwithstanding his clients assisting him with carrying their purchased glass to their motor vehicle from time to time. Furthermore, since Rayming has never employed any other employee, there were no training and induction records for employees.

35. Mr Zhu was alone at the time the panes of glass fell on him. There was a claw hammer with a blue handle on the timber frame which the glass pane fell from. Mr Chen does not know why Mr Zhu was situated between the two A frames considering Mr Chen had informed him that he would drive him to the train station once his customers had gone and that there was no other panes of glass that needed to be moved.

36. The storage and handling of glass panes is a high-risk activity that has potential to cause serious injuries. The fact that people were able to access the area where the “A” frame and glass panes were stored at the premises meant that people were at risk of having glass fall on to them. This meant that the premises was unsafe.

37. Neither Rayming or Mr Chen ascertained the safe work load of the “A” frames used at the premises by having the “A” frames tested and assessed by a qualified professional in Australia.

38. Neither Rayming or Mr Chen regularly assessed the weight of pallets of glass panels or individual glass panels stored on “A” frames at the premises by way of using a scale or other device to measure the weight of the pallets of glass in order to ensure that the safe workload of “A” frames was not exceeded.

39. Neither Rayming or Mr Chen ensured that chocks were fixed to all “A” frames at the premises at all times so as to ensure that the pallets of glass panes and individual glass panes stored on “A” frames were not over balanced.

40. Following the incident, WorkCover issued to Rayming an Improvement Notice (No. 249727) dated 31 August 2007 that required Rayming to ensure that the packaged glass packed in timber are unpacked in a secure and safe manner by either ensuring the timber packs are secured at an appropriate angle in A-Frames or laid flat on the floor. A copy of Improvement Notice (No. 249727) is “Annexure D”.

41. Immediately following the incident, Rayming ceased to trade.

The Defendant’s Criminal History

42. The defendant has no prior occupational health and safety convictions. A copy of the Prior Convictions Report is “Annexure E”.

Relevant Principles
8 In considering penalty, I take guidance from the reasoning of the High Court in Markarian v R [2005] HCA 25; (2005) 228 CLR 357 and their Honours’ view that the task of sentencing must acknowledge the effect of the applicable legislative provisions (in this case s10(1) of the Occupational Health and Safety Act 2000 with ss21A, 22, 23 and 34 of the Crimes (Sentencing Procedure) Act 1999). The court, using the “instinctive synthesis” approach, would include an assessment of the objective and individual subjective factors, with the appropriate weight given to each factor, and could (but not should) give a degree of deduction in penalty to some element in the consideration in such circumstances as where it better serves the interests of transparency, which element should be narrowly confined (for example, the utilitarian value of the plea).

9 Their Honours recognised the “instinctive synthesis” approach to sentencing gives rise to an inevitable tension between the need for transparency and adequate reasoning on the one hand, and the need to avoid a mathematical approach pursuant to which the sentencing court engages in a “staged sentencing process” starting at the maximum penalty and then making deductions from it without adequately assessing (even in a provisional way) the sentence called for by the objective facts (see Markarian v R [2005] HCA 25; (2005) 228 CLR 357).

10 Spigelman CJ in R v Thomson; R v Houlton (2000) 49 NSWLR 383, correctly, given the consideration in Markarian, recognised this “instinctive synthesis” approach to sentencing saying at [57]:

[57] The instinctive synthesis approach is the correct general approach to sentencing. This does not, however, necessarily mean that there is no element which can be taken out and treated separately, although such element ought be few in number and narrowly confined. As long as they are such, their separate treatment will not compromise the intuitive or instinctive character of the sentencing process considered as a whole.

11 Proper regard is to be had to express legislative provisions and to the relevant statutory regime (Markarian at [27]). The object of the Act is to protect employees from risk to safety, health and welfare whilst compelling attention to occupational health and safety issues so that persons are not exposed to risk to their health and safety at the workplace. Of relevance particularly is the effect of s21A of the Crimes (Sentencing Procedure) Act 1999.

Consideration
12 In consideration as to penalty, the Court first assesses the objective seriousness of the offence as charged: Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch’ng) (1999) 90 IR 464 (at 474):

In case of prosecutions under the OH&S Act, this proposition has often been expressed by saying that the "true measure of penalty lies in the nature and quality of the offence" ...

And in Morrison v Powercoal Pty Limited [2003] NSWIRComm 416; (2003) 130 IR 364 at [32]:

In assessing the gravity of the offence the focus, therefore, must be on the risk and, viewing it objectively, the seriousness of the act or omission that gave rise to the risk. In other words, the consequence of an accident will not, of itself dictate the seriousness of the offence or the amount of penalty. However, the occurrence of death or serious injury may well manifest the degree of seriousness of the risk to health and safety to which persons may have been subjected ...

13 These were most serious offences. Mr Chen, the individual defendant, was the controlling mind of the corporate defendant. There was no risk assessment performed for the storing of heavy glass panes and mirrors. The pallets of glass panes weighed approximately 1.8 to 2 tonnes. The pallets were placed on steel A frames and not secured. There was a forklift but no crane to carry the weight of the pallets. Mr Chen said he could not afford the expense of a crane and he also worried that the use of a crane could break the glass. Panes of glass were removed from the pallets without the pallets being secured. There was no assessment of the safe workload that the A frames could carry. There was no measure put in place to ensure against the pallets falling off the A frame nor any safe system designed for the taking of glass from the pallets.

14 Mr Chen, in the context of his plea, explained he had hired a forklift for moving the pallets; he used steel A frames for proper storage and carried each pane separately wearing gloves. He denied knowing the use of restraints to securely fasten pallets to the A frames was required and an industry standard. The pallets each held two tonnes of glass (approx). There was no system to ensure the pallets were secure on the A frames before the removal of the glass. Mr Chen contended that, as the sole employee on site and his wearing of gloves, this was not a problem to him.

15 Mr Chen allowed Mr Zhu, the deceased, who was inquiring about work, to assist him in moving a pane of glass; he then allowed Mr Zhu access onto the warehouse premises where the pallets of glass were stored. Mr Zhu was allowed access to the premises when Mr Chen was absent from the site. There were no warning signs in the warehouse as to the danger of the stored goods. Mr Zhu was seen shaking a wooden pallet storing 25 to 30 panes of glass weighing 1.8 tonnes. Many of the panes of glass dislodged and fell upon him. No one could lift the glass from Mr Zhu. There was no equipment available to assist in lifting the glass panes off Mr Zhu. The Police opined Mr Zhu had been attempting to remove glass unassisted and from an unsecured pallet on an A frame.

16 The principle of foreseeability is a factor in determining the objective seriousness of an offence. This was considered and affirmed in Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610. On the issue of foreseeability, the Full Bench in Capral stated at [82]:

The existence of a reasonably foreseeable risk of injury will necessarily result in the offence being more serious in nature. However, the absence of foreseeability does not necessarily render the offence as being nominal or not serious. In this regard the relevant approach is that set out in the judgment of Wright J, President, in Ferguson v Nelmac Pty Ltd (at 209-210) in these terms:

“... reliance on 'hindsight' must be seen in an appropriate perspective in terms of culpability. It is a relevant consideration but the very terms of s 15 impose an obligation on an employer which is not confined to the taking of precautions only when there are warnings or signals of danger or when experience indicates that a risk to safety has arisen and requires remedy.

Mr Chen had attended a WorkCover course. Common sense would warn that unrestricted access to industrially dangerous premises is to be avoided and warned against. There were many basic breaches of the safe working principles on this site - the failure to have a safe system for storing dangerous goods; the failure to have a system in place for removing those goods; the failure to securely store heavy pallets; the failure to have the proper machinery for removing the goods stored on pallets; the failure to have in place a system for the moving/removal of the pallets; the failure to have a system to protect against persons coming on to the premises especially in a circumstance where such premises were not safe; the failure to risk assess the task of moving panes or pallets; the failure to put safe working procedures in place. I accept there was a foreseeable element to the offence which makes it an even more serious offence, this is especially so in a circumstance where the individual defendant had attended a WorkCover Safe Working Course.

17 The availability of simple and straightforward steps to remedy the defects in the system is also relevant to the consideration of the objective seriousness of the offence (WorkCover Authority of New South Wales (Inspector Ch'ng) v ACI Operations Pty Limited, unreported decision of Schmidt J dated 25 February 1994). There were obvious steps that could have been taken which either singly or in combination would have eliminated or reduced the risk. There are industry standards which give guidance to anyone establishing such an enterprise, for example: identified lifting devices recommended for the lifting of particular weights; systems for the storage and securing of specified weights and systems designed for the removal and storage of glass panes and the placement of simple warning signage.

18 The gravity of the potential risk to safety flowing from a breach is relevant as a measure of gravity of the breach and the culpability of the defendants (Lawrence Diecasting Limited and WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 (at 474)). The potential risk of significant injury or death was not a remote possibility. There was a high risk to the safety of any person even entering these premises and an especially high risk when the pallets were approached or any attempt was made to remove a pane of glass from the unsecured pallet. It appears the pallet itself was unable to withstand the weight in it. When the pallet was shaken, a whole pallet load of glass fell forward onto Mr Zhu. The potential risk to safety became a reality. As was held by Hill J in Tyler v Sydney Electricity (1993) 47 IR 1 (at 5):

The gravity of the damage or injury actually resulting from breach does not, of itself, dictate the amount of penalty. However, the gravity or otherwise of the potential risk flowing from breach and its foreseeability are clearly relevant . . .

19 The principles of general and specific deterrence are also relevant in sentencing considerations. The approach to be taken has been considered in some detail in Capral at [71]-[77]. Each approach to deterrence in the sentencing process is encapsulated in the following passage from the Full Bench at [74]:

... both aspects of deterrence are matters which should normally be given weight of some substance in the sentencing process; and although there may be exceptional cases (see, for example, Page v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39 at [40]- [43]) we would expect such cases to be very rare, and where the relevant circumstances were held by the sentencing judge to be established, the judge must indicate with some precision the circumstances which had led to the exceptional course being adopted.

Mr Chen says he wishes one day to again become entrepreneurial. While he has shut down the business the corporation is still registered although with no assets and some debt. It is not trading. Given Mr Chen's intention to conduct a business and given the company is still on the record with Mr Chen as its sole director, there shall be an element of specific deterrence to both prosecutions. As to the element of general deterrence let this sad circumstance remind all who intend to establish a business it cannot be done safely without proper planning and expenditure. A priority must be given to the design of safe work systems.

20 Mr Chen set up a business without all the necessary systems and equipment in place. This was most foolish even negligent. Businesses that involve the storage of dangerous goods in a warehouse operation must take the utmost care. The focus of such businesses must firstly be to ensure its storage premises provide safe access, secure storage and the appropriate systems and equipment for the removal and movement of those dangerous goods. It must also provide warning signs. The drive for customers must not be the priority. There must be at least concurrently created a safe system for the work. In a circumstance where the goods have been purchased, it is not acceptable to only then determine in what name the goods are imported or where and how such goods are stored. Mr Chen contends that he had a buyer but the sale fell through requiring he then create the company and store the goods. I find this to be an unacceptable explanation for Mr Chen's failure to properly and safely store dangerous goods and his failure to have in place a safe system for the access to those goods.

21 It is also necessary to have regard to those general matters going to aggravation, mitigation and other factors identified in s 21A (1) of the Crimes (Sentencing Procedure) Act 1999 relevant to the defendants. As was said in R v Way [2004] NSWCCA 131; (2004) 60 NSWLR 168 at [56]:

56 ... it is not to be overlooked that there is a well established body of principles that have been developed by the courts over a long period of time. By providing guidance in the form of a list of aggravating and mitigating factors in s 21A, the Parliament did not intend to overrule or disturb those principles or restrict their application. In so far as those principles refer to factors, whether objective or subjective, that affect the “relative seriousness” of the offence, they are expressly preserved by s 21A(1)(c)

Ultimately, all of the above factors must be considered as part of "a complex of inter-related considerations" (R v Gallagher (1991) 23 NSWLR 220 at 228).

22 The defendants rely on the fact that the plea of guilty was entered at the earliest stage in the proceedings (R v Thomson; R v Houlton (2000) 49 NSWLR 383). The defendants are entitled to some discount for the utilitarian value of their pleas of guilty. I allow a discount of 15 percent.

23 Mr Chen contends he co-operated with WorkCover Authority. The file however indicates that there was a challenge mounted to WorkCover Authority regarding Notices which WorkCover Authority had issued to the corporation requiring the introduction of safe systems of work. Only then did the company cease operation. Mr Chen clearly had to be persuaded as to his obligation to ensure he conducted safe work premises.

24 A number of significant features were placed before the Court for consideration as to the subjective elements of the offence. This is one of the most serious offences this court has had to consider. The defendant, Mr Chen, the sole director of the second defendant, came to Australia in 2000, aged 17 after finishing high school in China, Guangdong Province. He had to learn English. In 2001, he enrolled at the University of Technology in a bridging course to assist in both university entrance and his command of the English language. He then enrolled in the UTS Business Studies Diploma graduating in 2004. He then enrolled and completed a Bachelor of Business Studies at Charles Sturt University graduating in 2006. His parents paid all his tuition fees and throughout his studies he worked part time. After graduation, his father encouraged him to set up an import business.

25 In Australia, he set up and his father funded Rayming Pty Ltd. Mr Chen was the sole director of Rayming Pty Ltd which was established in June 2006. The corporation imported a container load of glass and mirrors to sell to wholesalers. Mr Chen attested he had a buyer for the first container load but that buyer fell through as the container arrived. He had not established the corporation before the container arrived. He only then attended at the Office of Fair Trading to get guidance on how to establish a business. He then attended an induction course at WorkCover for "construction work in New South Wales" and obtained a certificate. He contends:

39 I am very regretful that after making inquiries with the office of Fair Trading, attending to inductions and discussing with my Accountant, that no one told me that WorkCover requires signage restricting access, mechanical lifting equipment, the use of restraints, the need to determine the maximum load of A frames and their use for storage and handling individual glass panes. Had I been informed, I would have definitely complied...

41 It was my belief that the need to restrict access to the public was unnecessary as I was the only one who accessed this area alone. Even when a customer was present, I would be present at all times. I now understand the importance of restricting access to the Premises and ensuring that all individuals who attend to a workplace need to be supervised at all times and for them to be instructed accordingly on what they can access and what they cannot access.

26 Mr Chen reveals the corporate defendant paid $2000 to import the panes of glass. His father later funded Rayming the sum of $30,000 to buy some glass polishing equipment. The corporation traded a $25,398.19 loss for the year ending June 2007. The Commonwealth Bank account of Rayming was closed on 8 October 2007. Rayming sold its equipment for $8800 to Wylie in September 2009. There is no financial record indicating where that amount was deposited. Wylie is the company Mr Chen now works for.

27 Mr Chen now acknowledges since working with Wylie, he has become aware of the proper equipment and signage required in storage facilities as well as the type of equipment necessary for securing and moving dangerous and heavy goods. Mr Chen is a young immigrant with a business degree and given he has attended English language classes and obtained both a Diploma and a University degree in this country I infer he is skilled in the English language. He is currently earning $500 a week. He has recently married. Mr Chen states his aim is one day "to be my own boss again".

28 However, Mr Chen must carry a financial burden for this most serious breach of the Occupational Health and Safety Act. While the court takes into account the financial status of each defendant and is reminded that penalty must not be too onerous, the law has determined the most significant consideration on assessment of penalty is the objective seriousness of the offence.

29 The first of the Occupational Health and Safety legislation came into law in New South Wales as far back as 1983. This legislation and government standards have placed upon employers obligations and it is abundantly clear the State requires Occupational Health and Safety awareness and action from employers in their business enterprises. Mr Chen did an induction course at WorkCover Authority but says he only came away with a knowledge that lifting could hurt one's back. I do not accept that this could be his understanding given his language skills and the obtaining of his diploma and business degree in Australia. It appears he was bringing into Australia a container of glass without any business identity nor place for storage of that glass. When a proposed sale fell through only then did he make inquiries as to matters he had to attend to in establishing a business. Even if he was not aware of particularised obligations under the Occupational Health and Safety Act, he neglected both as a director and as the controlling mind of the corporation the simple procedures necessary for safe storage of dangerous goods. A stranger on his worksite is now deceased because there were no safe systems in place at the warehouse he occupied. The penalty must reflect this.

30 The defendants imported pallets of glass weighing up to 1.8 tonnes. Mr Chen failed, in preparation of that import to restrict access to his storage premises; did not risk assess the handling of the glass; did not provide the proper equipment for the movement of the glass; did not secure wooden pallets to the steel A frames; did not ensure safe weight loading on the A frames; allowed an unqualified and inexperienced person access into his storage unit; allowed an unqualified, untrained person to handle glass. This was a most serious offence with the risk leading to the worst of consequences.

31 I am satisfied Mr Chen and the corporation, given the pleas of guilty, have now accepted responsibility for failing to have in place a proper system of work in its failure to properly store dangerous goods. However, Mr Chen does not reveal he provided any assistance to Mr Zhu's family nor does the evidence satisfy he even offered the appropriate care. Neither the corporation nor Mr Chen can rely upon evidence of industrial good character or community contribution since the business inception in 2006. While Mr Chen was educated in Australia, he has not absorbed all the basics necessary to establish a responsible business.

32 The company for the first offence faces a maximum penalty of $550,000. The individual defendant faces a maximum penalty of $55,000.

33 All the particulars pleaded against the corporate defendant have been established on the evidence. The same particulars are relied upon against the individual defendant. Mr Chen was the sole director and employee of the defendant corporation. He was the controlling mind of the corporation. I accept the plea by both defendants to the charge as pleaded.

34 I find the defendants guilty as charged.

Orders
35 The Court makes the following orders:

1. In Matter No IRC1153 of 2009, I find the corporate defendant guilty of the offence as charged.

2. The defendant is fined in the sum of $180,000 with a moiety to WorkCover Authority of New South Wales.

3. In Matter No IRC1152 of 2009, I find the individual defendant guilty of the offence as charged.

4. The defendant is fined in the sum of $35,000 with a moiety to WorkCover Authority of New South Wales.

5. There shall be one order as to costs to be shared between each defendant. If there is no agreement reached between the parties leave to re-list at short notice.



LAST UPDATED:
17 September 2010