Inspector Hinton v CBG Pty Ltd [2011] NSWIRComm 9 (25 February 2011)

Last Updated: 15 March 2011

Industrial Relations Commission New South Wales

Case Title:	Inspector Hinton v CBG Pty Ltd
Medium Neutral Citation:	[2011] NSWIRComm 9
Hearing Date(s):	10 February 2011
Decision Date:	25 February 2011
Jurisdiction:
Before:	Staff J
Decision:	Matter No IRC 762 of 2010 1. The offence is proven and a verdict of guilty is entered. 2. The corporate defendant is convicted of the offence, as charged. 3. The corporate defendant is fined an amount of $250,000 with a moiety thereof to the prosecutor. 4. The corporate defendant shall pay the prosecutor's costs of the proceedings in an amount as agreed, or if agreement cannot be reached, as assessed. Matter No IRC 763 of 2010 1. The offence is proven and a verdict of guilty is entered. 2. The personal defendant is convicted of the offence, as charged. 3. The personal defendant is fined an amount of $25,000 with a moiety to the prosecutor. 4. The personal defendant shall pay the prosecutor's costs of the proceedings in an amount as agreed, or if agreement cannot be reached, as assessed.
Catchwords:	OCCUPATIONAL HEALTH AND SAFETY - prosecution under s 10(1) and s 26(1) of the Occupational Health and Safety Act 2000 - residential building site - premises controlled by defendants - premises not adequately secured - open pier holes - non-employee - fatality - objective seriousness - maximum penalty - worst case - principles - comparison of sentences - principles - victim impact statement - application for s 10 Crimes (Sentencing Procedure) Act 1999 by personal defendant refused - penalties imposed - COSTS - Occupational Health and Safety Act 2000 s 10(1), s 26(1)
Legislation Cited:	Crimes (Sentencing Procedure) Act 1999 Fines Act 1996 Occupational Health and Safety Act 2000
Cases Cited:	Cahill v State of New South Wales (Department of Community Services) (No 4) [2008] NSWIRComm 201; (2008) 182 IR 231 Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 99 IR 29 Director of Public Prosecutions (Cth) v De La Rosa [2010] NSWCCA 194; (2010) 243 FLR 28 Inspector Beacham v J & L Marble Pty Ltd [2009] NSWIRComm 100 Inspector Glass v Foamex Polystyrene Pty Ltd [2004] NSWIRComm 100 Inspector Jelley v Albright & Wilson (Australia) Limited [2007] NSWIRComm 148; (2007) 164 IR 456 Inspector Milligan v Roads and Traffic Authority (Industrial Court of New South Wales, 29 August 1996, unreported) Inspector Prasad De Silva v Spicer Axle Australia Pty Ltd [2005] NSWIRComm 278 Inspector Sharpin v A Team Concrete (Aust) Pty Ltd & Ors [2004] NSWIRComm 182 Inspector Simpson v Tomago Aluminium Co Pty Ltd ((unreported) Haylen J 27 April 2004 Matter No IRC 5351 of 2003) Inspector Stephen Campbell v James Gordon Hitchcock [2005] NSWIRComm 34; (2000) 139 IR 439 Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 Maddaford v CSR Limited and Mulgoa Quarries Pty Ltd [2004] NSWIRComm 337 Morrison v Coal Operations Australia Ltd (No 2) [2005] NSWIRComm 96; (2005) 141 IR 465 Nelmac Pty Ltd v Franke (Inspector) [2006] NSWIRComm 100; (2006) 151 IR 63 Previtera (1997) 94 A Crim R 76 Riley v Australian Grader Hire Pty Ltd [2001] NSWIRComm 31; (2001) 103 IR 143 Rodney Morrison v Powercoal Pty Ltd [2003] NSWIRComm 416; (2003) 130 IR 364 R v Mansour [1999] NSWCCA 180 R v Thomson; R v Houlton (2000) 49 NSWLR 383 Sacco Builders Pty Ltd v Inspector Chaston [2009] NSWIRComm 153; (2009) 188 IR 79 T and M Industries (Aust) Pty Ltd and Anor v WorkCover Authority (NSW) (Inspector Sequeira) [2006] NSWIRComm 25; (2006) 151 IR 130 WorkCover Authority (NSW) (Inspector Ankucic) v Lyndhurst Trading Co Pty Ltd (2000) 95 IR 462 WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Ltd [2000] NSWIRComm 1123; (2000) 95 IR 383 WorkCover Authority of New South Wales (Inspector Downie) v Menzies Property Services Pty Limited [2004] NSWIRComm 259; (2004) 136 IR 449 WorkCover Authority of New South Wales (Inspector Farrell) v David Carl Schrader [2002] NSWIRComm 25; (2002) 112 IR 284 WorkCover Authority of New South Wales (Inspector Hopkins) v Profab Industries Pty Ltd [2000] NSWIRComm 142; (2000) 100 IR 64 WorkCover Authority (NSW) (Inspector Mason) v Wild Geese Building and Maintenance Group Pty Ltd [2006] NSWIRComm 350; (2006) 157 IR 313 WorkCover Authority of New South Wales (Inspector Robert Mayell) v D J Gleeson Pty Ltd [2006] NSWIRComm 363 WorkCover Authority of New South Wales (Inspector Mulder) v Arbor Products International (Australia) Pty Ltd [2001] NSWIRComm 50; (2001) 105 IR 81 WorkCover Authority (NSW) (Inspector Shaw) v Du Pont (Australia) Pty Ltd [2006] NSWIRComm 116; (2006) 152 IR 68
Texts Cited:
Category:	Principal judgment
Parties:	Inspector Jamie Michael Hinton (Prosecutor) CBG Pty Ltd (First Defendant) Sohan Singh Birring (Second Defendant)
Representation
- Counsel:	Mr P Ginters of counsel (Prosecutor) Mr P Nematalla of counsel (Defendants)
- Solicitors:
File number(s):	IRC 762 and 763 of 2010
Publication Restriction:

JUDGMENT

1	On 12 August 2008, CBG Pty Ltd ("the corporate defendant") had control of a construction site at the rear of premises situated at 2-4 First Street, Kingswood in the State of New South Wales ("the site"), where three townhouses were to be built.

2	On that day, 17 pier holes were dug on the site. The holes were approximately 450mm in diameter and approximately 1.8m - 2.0m deep.

3

At the conclusion of work on 12 August 2008, the pier holes were left uncovered. The only measure taken to warn of the hazards and risks to the health of persons who were not the corporate defendant's employees, was that a role of red and white safety tape marked with the word "danger" was pulled along the perimeter of the premises at approximately 4.45pm.

4	Either later that evening, or early the following morning, Mr John Michael Korol, a member of the public, fell head first into one of the pier holes whilst trying to retrieve his dog which had fallen into one of the pier holes.

5	Mr Korol, aged 39 years died from asphyxia. His dog was rescued by the police.

6	Had measures been taken by the defendants to ensure the health and safety of non-employees, Mr Korol's death would have been avoidable, as would the trauma and illness that his partner of 15 years suffered.

7	The corporate defendant and Mr Sohan Singh Birring ("the personal defendant"), a director of the corporate defendant acknowledged their culpability in pleading guilty to charges brought pursuant to s 10(1) of the Occupational Health and Safety Act 2000 (" OHS Act" ).

8

The defendants relied on various subjective matters to which I will refer. However, the subjective matters must be assessed against the objective seriousness of the offence. In this respect the Full Bench in Inspector Prasad De Silva v Spicer Axle Australia Pty Ltd [2005] NSWIRComm 278 stated at [13] as follows:

... It is a well known and long established principle of sentencing that subjective considerations play a subsidiary role in the sentencing process to the objective considerations: see for example Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 at 475.

9	I am satisfied, on the evidence, the defendants are guilty as charged and that it was appropriate for pleas of guilty to be entered. It follows that this judgment is concerned with the penalty that the Court should impose for the contravention of the OHS Act .

The charges

10

The corporate defendant, in an application for order, was charged with a breach of s 10(1) of the OHS Act , by failing by its acts and omissions, to ensure that having had control in the course of its trade, business or other undertaking of a building, that the premises were safe and without risk to the health of persons who were not the defendant's employees, in particular, John Michael Korol.

11	The particulars of the charge were:

(a) At all material times the defendant had control or alternatively, only limited control of the premises.

(b) At all material times persons not employed by the defendant, in particular Sean Teague and Matthew Reitsma, used the premises as a place of work.

(c) At all material times the premises were not used only by the employees of the defendant.

(d) At all material times the premises were not occupied solely as a private dwelling.

(e) At all material times the premises were controlled by the defendant in the course of its trade, business or other undertaking.

(f) At all material times the defendant exerted its control of the premises by reason of it being given exclusive possession of the premises to carry out building works.

The particulars of the risk were that:

(g) There was a risk of injury to persons gaining access to the premises and falling into an exposed pier hole.

The particulars of the acts or omissions in failing to eliminate that risk were:

(h) The defendant did not ensure that the premises were adequately secured against unauthorised access by use of locked perimeter fencing to ensure that the premises were safe and without risks to health.

(i) The defendant did not ensure that the premises were safe and without risks to health in that the defendant did not ensure that pier holes that had been dug at the premises were adequately covered or protected by temporary coverings so as to prevent the risk.

(j) The defendant did not ensure that systems of work at the premises were provided or maintained to ensure that the premises were safe and without risks to health in that the defendant failed to:

(i) ensure that the premises were adequately secured against unauthorised access by use of locked perimeter fencing;

(ii) ensure that the pier holes that had been dug at the premises were adequately covered or protected by temporary coverings;

(iii) ensure that a site specific occupational health and safety plan for the premises was prepared and maintained;

(iv) undertake an adequate risk assessment that identified and considered the means of controlling the risk in circumstances where the premises were:

(1) unsecured by reason of the absence of locked perimeter fencing; and

(2) there were exposed pier holes;

(v) ensure that each sub-contractor, before commencing work at the premises, provided the defendant with a written safe work method statement for the work to be carried out by the sub-contractor.

(k) The defendant did not ensure that work undertaken at the premises was adequately supervised to ensure that the premises were safe and without risks to health in that the defendant failed to provide a specifically designated site supervisor at the premises to:

(i) provide information and instruction to and supervision of subcontractors working at the premises;

(ii) ensure that the premises were adequately secured against unauthorised access by use of locked perimeter fencing;

(iii) ensure that pier holes that had been dug at the premises were adequately covered or protected by temporary coverings;

(iv) ensure that a site specific occupational health and safety plan for the premises was prepared and maintained;

(v) ensure that each sub-contractor, before commencing work at the premises, provided the defendant with a written safe work method statement for the work to be carried out by the sub-contractor.

As a result of the defendant's acts and omissions, Mr Korol was exposed to the risk at the premises. Mr Korol's death was a manifestation of that risk.

12

The personal defendant was charged by virtue of s 26(1) of the OHS Act of a breach of s 10(1) of the OHS Act in the same terms as the corporate defendant. The particulars relied upon were identical to those in respect of the corporate defendant, with the addition of a particular that the personal defendant was a director of the corporation.

Statutory provisions

13	Section 10 and s 26 of the OHS Act provide:

10 Duties of controllers of work premises, plant or substances

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

(2) A person who has control of any plant or substance used by people at work must ensure that the plant or substance is safe and without risks to health when properly used.

(3) The duties of a person under this section:

(a) do not apply to premises, plant or substances used only by employees of the person, and

(b) do not apply to premises occupied only as a private dwelling or to plant or substances used in any such premises, and

(c) extend to the means of access to or exit from a place of work, and

(d) apply only if the premises, plant or substances are controlled in the course of a trade, business or other undertaking (whether for profit or not) of the person.

(4) In this section, a person who has control of premises, plant or substances includes:

(a) a person who has only limited control of the premises, plant or substances (in which case any duty under this section applies only to the matters over which the person has control), and

(b) a person who has, under any contract or lease, an obligation to maintain or repair the premises, plant or substances (in which case any duty under this section applies only to the matters covered by the contract or lease).

26 Offences by corporations-liability of directors and managers

(1) If a corporation contravenes, whether by act or omission, any provision of this Act or the regulations, each director of the corporation, and each person concerned in the management of the corporation, is taken to have contravened the same provision unless the director or person satisfies the court that:

(a) he or she was not in a position to influence the conduct of the corporation in relation to its contravention of the provision, or

(b) he or she, being in such a position, used all due diligence to prevent the contravention by the corporation.

(2) A person may be proceeded against and convicted under a provision pursuant to subsection (1) whether or not the corporation has been proceeded against or been convicted under that provision.

(3) Nothing in subsection (1) prejudices or affects any liability imposed by a provision of this Act or the regulations on any corporation by which an offence against the provision is actually committed.

(4) In the case of a corporation that is a local council, a member of the council (in his or her capacity as such a member) is not to be regarded as a director or person concerned in the management of the council for the purposes of this section.

Prosecutor's evidence

14	Mr P Ginters of counsel appeared for the prosecutor and tendered an agreed statement of facts which provided:

1. At all material times the prosecutor, Inspector Hinton was 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 Occupational Health and Safety Act 2000 ("OHS Act 2000") to institute proceedings in this matter.

2. At all material times CBG Pty Ltd [ACN 003 673 783] ("CBG"), was a corporation whose registered office is situated at Lower Russell & Farr, First Level, 81 Henry Street Penrith in the State of New South Wales.

3. At all material times Sohan Singh Birring DOB: XX XXXXXXX XXXX of XXX XXXXXXXXX XXXX XXXXXX ("Mr Birring") was a director of a corporation CBG Pty Ltd c/- Lower Russell & Farr, First Level, 81 Henry Street Penrith in the State of New South Wales ("the corporation").

The CBG and Mr Birring

4. At all material times CBG was a body corporate and entitled to be prosecuted by its corporate name and style.

5. CBG carries on business in the State of New South Wales performing construction works.

6. At all material times Mr Sohan Singh Birring was a director of CBG and was appointed as such on 23 March 1989.

Contractual Relationships at 2-4 First Street Kingswood NSW

7. Inglow Two Pty Ltd ("Inglow") was and is the owner of a construction site at the rear of premises situated at 2-4 First Street, Kingswood, NSW 2747 ("the premises").

8. On 2 December 2007 Inglow contracted with CBG for it to construct three (3) townhouses on the premises ("Contract"). The Contract price was $528,000.

9. Pursuant to clause 11.1 of the Contract Inglow gave CBG exclusive possession of the premises to enable it to carry out the contracted building works.

10. CBG engaged Specialist Clinic Management Pty Ltd (" SCM ") to assist it with the performance of management and administrative duties on its behalf in relation to the construction works undertaken at the premises.

11. Mr Sean Teague trading as S T Concreting was engaged on behalf of CBG to lay the concrete foundation for the construction of the townhouses at the premises.

12. On about 2 August 2008, C R Anderson Earthmoving was engaged by CBG to "cap [the] housepad" at the premises. This work was arranged through Mr Bradley Allchin, an employee of SCM ( "Mr Allchin" ). Notwithstanding that this work had been undertaken at the premises no arrangements had been made to secure the premises by, for example, the installation of perimeter fencing. CBG's usual practice is to have perimeter fencing in place at building sites prior to any machinery going onto the premises.

13. In addition to the above, prior to 12 August 2008, other preparatory work had occurred at the premises including pegging it out for planning purposes and placing a portable toilet on the premises. Despite this preparatory work being undertaken perimeter fencing was not in place at the premises.

14. Mr Teague subcontracted Mr Matthew Reitsma trading as Dynamic Excavations to perform excavation works at the premises.

15. CBG through its director, Mr Sohan (Simon) Birring, subcontracted BMW Plumbing Services Pty Ltd to perform plumbing works at the premises.

16. Approximately a week prior to the incident, Mr Teague met with Mr Allchin at the premises to discuss the work to be done and to obtain plans for the premises. However, as Mr Allchin did not have the plans with him, the pair attended the offices of SCM for the purpose of obtaining a copy of the plans for the premises.

17. Following that meeting, Mr Teague contacted Mr Reitsma to arrange for him to attend the premises and perform pier hole drilling works on 12 August 2008.

18. On 12 August 2008 Mr Reitsma arrived on premises and began, under the direction of Mr Teague, to dig the pier-holes outlined on the building plans. It was intended that the pier holes would be drilled and filled with cement on the same day.

19. On 12 August 2008 Mr Reitsma dug approximately 17 pier holes. The pier holes were approximately 450 mm in diameter and approximately 1.8 to 2 metres deep. After approximately 17 pier-holes were dug, Mr Reitsma hit a sewer pipe. Mr Teague rang Mr Birring to advise him of the situation.

20. Mr Birring attended the premises to direct works in relation to repairing the damage to the sewer pipe. He arranged for Mr Janes, plumber employed by BMW Plumbing Services Pty Ltd, to attend the premises to assist with the rectification works.

21. Mr Janes arrived at the premises at approximately 3.00 pm. He indicated that it would take approximately one to two hours to fix the broken sewer pipe. Given the time indicated to repair the sewer pipe and the time of day, Mr Teague told Mr Birring that he was leaving the premises.

22. Prior to leaving the premises, Mr Teague left Mr Birring and Mr Reitsma with a roll of red and white safety tape marked with the words "danger" to be put up at the premises .

23. Mr Reitsma, under the instruction of Mr Birring and Mr Janes, dug out an area so that Mr Janes could repair the sewer pipe.

24. Whilst at the premises, Mr Birring observed the dug pier holes and contacted TFH fencing to arrange for a perimeter security fence to be installed, as the premises was unsecured. This was booked to be installed on 14 August 2008. Mr Birring made no arrangements other than those referred to below to secure the premises as he believed that Mr Teague was going to return to the premises that afternoon to fill the pier holes with concrete.

25. Upon completion of the repair works to the broken sewer pipe, Mr Reitsma commenced to backfill the sewer line. Whilst completing this task, Mr Birring instructed him to pull the safety tape around the external perimeter of the premises when he finished work for the day.

26. Shortly prior to completion of the backfilling, at approximately 4.00pm Mr Birring and Mr Janes left the premises. Mr Reitsma completed his work and pulled the safety tape along the perimeter of the premises as instructed and left the premises at approximately 4:45pm.

27. The pier holes that had been dug by Mr Reitsma on 12 August 2008 were left uncovered.

Incident

28. On Wednesday 13 August 2008 Mr Allchin arrived at the premises to meet with Mr Janes. Upon arrival, Mr Allchin conducted a visual inspection of the pier holes where he found the body of Mr Korol in one of the pier holes located at the premises.

29. Mr Korol was a 39 year old male who resided in a townhouse located within X XXXXX XXXXXX XXXXXXXXX XXX but XXXXXXXX XX XXX premises. Mr Korol's residence was only a short distance (approximately X metres) from the premises where the pier holes had been dug.

30. There were no eye witnesses to the incident, however it appears that Mr Korol fell head first into one of the pier holes whilst trying to retrieve his dog on the morning of 13 August 2008. The pier hole that Mr Korol was discovered in was approximately 500mm in diameter and approximately 1800mm deep with approximately 200mm of water at the bottom of it. Cause of death as outlined in the interim post-mortem report was asphyxia.

The defendant's omissions

31. There was no perimeter fencing to secure the premises prior to or at the time Mr Korol's body was discovered on 13 August 2008.

32. Mr Birring attended the premises on the afternoon of 12 August 2008 and noted the lack of fencing to properly secure the premises. Whilst he contacted TFH fencing to arrange for a perimeter security fence to be installed, this was booked to be installed on 14 August 2008.

33. Mr Birring made no other arrangements to secure the premises. It was only at the suggestion of Mr Teague, and after his provision of red and white safety tape, that Mr Birring requested of Mr Reitsma that he place the safety tape around the external perimeter of the premises.

34. CBG 's policy provided instructions that fencing was to be put in place prior to construction works commencing. CBG has acknowledged in a Record of Interview that fencing ought to have been in place at the premises. This task is usually allocated by CBG to the premises supervisor.

35. Mr Birring whilst at the premises did not consider the possibility that the pier holes would not be filled in by the end of the day, despite the damage to the sewer pipe and the need for repairs to it to be undertaken occurring in the mid to late afternoon period.

36. On the day of the incident no adequate risk assessment was conducted to determine the hazards and the level of risk posed by leaving the premises unsecured and leaving pier holes exposed at the premises.

37. CBG did not have in place any place a site safety plan in relation to the works being undertaken at the premises and in particular working with exposed pier holes and ensuring that the premises were secured against unauthorised access.

38. CBG did not have in place any system to supervise the works being undertaken by the various sub contractors working at the premises.

39. Prior to works commencing at the premises, CBG did not request from any of the subcontractors a copy of their safe work method statements for the works to be undertaken and did not ensure that it obtained one prior to the subcontractors commencing work at the premises.

40. CBG did not provide any information or instruction to any of the subcontractor working at the premises that the pier holes that had been dug at the premises on 12 August 2008 were to be adequately covered or protected by placing temporary coverings over the pier holes prior to work ceasing at the end of the day.

Investigation of the Incident

41. On 13 August 2008, Inspector Hinton attended the premises and made observations contained in a Factual Inspection Report dated 15 August 2008.

42. On 13 August 2008, whilst at the premises Inspector Hinton took 18 photographs.

Systems of work following the incident

43. On 13 August 2008 Mr Birring contacted a carpenter and arranged to have the pier holes on the premises covered. There does not appear to be any reason why this could not have been arranged to occur on 12 August 2008 when Mr Birring became aware of the pier holes having been dug at the premises.

44. On the 13 August 2008, Mr Birring contacted TFH Fencing and arranged for premises perimeter fencing to be installed that day.

45. CBG also put in place a Site Induction Agenda outlining the induction procedure to be undertaken with subcontractors.

46. Following the incident CBG developed an OH&S Site Plan for the premises. This outlines the responsibilities of key personnel including the site supervisor. However, as at the time it was provided to WorkCover no supervisor had been nominated.

47. Following the incident, CBG wrote to their regular sub contractors advising them that they are to provide a copy of their safe work method statement at least one week prior to commencing work and that they are to report to the site foreman prior to commencing work.

48. Following the incident CBG has put standardised locks on all its building sites to ensure that the only person who can access the premises are CBG's building supervisor or site foreman.

Prior Criminal History

49. CBG has no prior convictions.

50. Mr Birring has no prior convictions.

15	The agreed statement of facts was also relied upon in respect of the charge brought against the personal defendant.

16	Mr Ginters also tendered the following documents:

(a) Factual Inspection Report of Inspector Hinton dated 15 August 2008;

(b) 18 colour photographs taken by Inspector Hinton on 13 August 2008 showing the premises where the incident took place, the pier hole into which Mr Korol fell, the deceased's dog found at the bottom of the hole, perimeter fencing erected after the incident and boards covering the pier holes with star pickets holding them into place, which were put in place after the incident;

(c) prior conviction reports which provided that both defendants had no prior conviction;

(d) Forensic Medicine Final Report Coroners Act 1980 prepared by Dr D Little, Department of Forensic Medicine, Westmead Hospital, dated 2 December 2008.

17	Counsel also provided to the Court a victim impact statement by Mr Glenn James Sheridan who was Mr Korol's partner for approximately 15 years.

Defendants' evidence

18	Mr P Nematalla of counsel appeared for the defendants and read an affidavit of Gregory Eric Allchin, who was called to give evidence and was briefly cross-examined. Counsel also tendered:

(a) psychological report of Steve Henkelman dated 2 November 2010;

(b) report of Associate Professor M A Fitzpatrick dated 5 November 2010;

(c) letter from Pradeep Raniga dated 18 November 2010;

(d) supplementary psychological report of Steve Henkelman dated 22 November 2010;

(e) letter from Robert Valades, Director of Benchmark Building Certifiers dated 7 January 2011;

(f) letter from William Monsieur of Wilpa Electrical Service dated 5 January 2011;

(g) letter dated 9 February 2011 from Lower Russell & Farr, Chartered Accountants, confirming the corporate defendant's income tax returns and financial statements showing the profits or losses between 2006 and 2010;

(h) letter from Lower Russell & Farr dated 9 February 2011 showing the personal defendant's income tax returns for the period 2006 - 2010.

Evidence of Mr Allchin

19	Mr Allchin is the General Manager of the corporate defendant and has been involved in its management since 1989.

20	Mr Allchin is a director of Specialist Clinical Management Pty Ltd which contracts management services to organisations.

21

Mr Allchin carried out a full investigation of the incident and prepared a report which was adopted by the directors of the corporate defendant and annexed to his affidavit. He stated that when the incident occurred it was mutually agreed between the directors of Inglow Two Pty Ltd, the owners of the site, and the corporate defendant that the building contract would be terminated without penalty to either party and the construction of the three townhouses would be completed by another builder retained by the owners of the site.

22

In June 2009, Mr Allchin said that the directors of the corporate defendant determined that it would continue to operate, but would cease operating as builders, and accordingly surrendered its building licence on 4 June 2009. From that time, the corporate defendant focused on property development and real estate acquisition. An organisational chart which commenced on 5 June 2009 was annexed.

23

The corporate defendant had been involved in the building industry in Australia for a period of 20 years and had an unblemished record. Prior to building in Australia, the corporate defendant was involved in similar sized building projects in the United Kingdom for over 20 years, again without any injuries or incidents. The personal defendant was the site supervisor for all projects over the 40 year period of the corporate defendant's operations both here and in the United Kingdom. He was not the site supervisor for the site where the accident occurred.

24

Mr Allchin gave an example of a major project carried out by the corporate defendant prior to the incident as the construction of a Bulky Goods Retailing Complex in Batt Street, Penrith ("Telstra project"). The work was carried out in a safe and well organised manner with no injuries or any near misses occurring during the construction. The value of the project was $6 M and had over 40 contractors engaged in the project. The personal defendant was the site foreman for this project. Mr Allchin annexed various photographs of that site together with induction records and minutes from meetings which recorded safety issues being raised on the agenda for those meetings. Also annexed was the OH&S Site Plan and Safe Work Method Statements ("SWMS"). A SWMS dated 3 May 2005 in respect of risk to public and safety identified the following causes as needing to be managed:

Perimeter fencing inadequate

Gaps in perimeter fencing allowing public access

No register of attendance onsite, &/or authorized attendance not

being checked by site supervisor

Site risk assessment inadequate

Unauthorised entry onsite

25

The documentation produced in respect of the Batt Street site known as the Telstra project was extensive and comprehensive. The minutes of a meeting held on 31 August 2005 in respect of the Telstra site under the heading "Safety" stated that "A safety walk around the site prior to the meeting revealed that all pits were either covered or had barricades around them". Records of toolbox meetings at the Telstra site were also annexed.

26

At the time of the hearing, the corporate defendant had one work site at Glenmore Park ("the Glenmore Park site"). This site is owned by CBG Family Discretionary Trust. Work commenced on this site prior to August 2008 and was suspended after the incident. The only works completed to date on the Glenmore Park site was the excavation of the basement car park. Mr Allchin said that the site has been regularly maintained.

27	The minutes of weekly meetings observed that safety audits were regularly conducted on the Glenmore Park site.

28	After the incident, the corporate defendant engaged the services of Ahmedi and Associates (The Safety Practice) to prepare the following:

(a) Occupational Health and Safety Manual for the site;

(b) a detailed Risk Management Plan;

(c) a Work Methods Safety Statement for maintaining the site;

(d) an Environmental Information Handbook.

Each of these documents attached to the affidavit were extensive and comprehensive in dealing with safety issues and hazards on construction sites.

29	The safety consultant made a recommendation that the Glenmore Park site should be inspected daily. This recommendation was adopted. It is also inspected by the safety consultant every four to six weeks.

30	The Glenmore Park site is double fenced, meaning there is a fence around the perimeter of the site and another around the evacuation works. This site is locked using a restricted key system and is fully signposted. Photographs of the site were annexed to the affidavit.

31	On 1 December 2010, the corporate defendant signed a building contract with Sydney West Constructions Pty Ltd to complete the Glenmore Park project. A special condition of the building contract is that Sydney West Constructions:

a. Engage the services of 'The Safety Practice' as their safety consultant.

b. That CBG's Occupational Health and Safety Coordinator continues to monitor safety of the project.

c. That CBG Pty Limited as a trustee for CBG Family Trust:

i. Has a representative at all safety meetings held for the project and that these meetings must occur at least weekly;

ii. Must receive copies of all toolbox meetings;

iii. Be advised of any breaches of Occupational Health and Safety Legislation or compliance; and

iv. Be advised immediately of any incident or complaint regarding Occupational Health and Safety.

d. That all Sydney West Construction OHS Policies and procedures and workplace rules are consistent with those of CBG Pty Limited.

32

Mr Allchin stated that in 2007, after the completion of the Telstra project, the personal defendant requested retirement from the day to day management of projects for the corporate defendant. He remained a director. One of the reasons for his decision was so that he could work fulltime as a volunteer for the Radha Soami Satsang Beas ("RSSB") Australia, the church he attends. RSSB appointed the personal defendant to manage the construction of a proposed $4 M development of an assembly hall and associated infrastructure at Cecil Park ("the Cecil Park site"). Mr Allchin volunteered as the project manager for the development which was a part-time position. Over 100 members of the church volunteered to assist with the building work. Many had no experience in the construction industry.

33

Two one day courses were held on weekends to assist the volunteers obtain their Occupational Health and Safety General Induction Card. This was a compulsory requirement for any volunteer or contractor wishing to work on the site. All volunteers and sub-contractors were inducted onto the site. The induction record book was annexed to Mr Allchin's affidavit and in total 120 volunteers and contractors carried out work on the development at Cecil Park.

34

Regular occupational health and safety inspections were carried out at the Cecil Park site. A sample of two inspections were annexed, together with records of two toolbox meetings. The site was also inspected on two separate occasions by the WorkCover Authority of New South Wales ("WorkCover"). On one occasion a lock was missing from an electrical box and the defect was noted. This was immediately rectified. The project took over 12 months to complete and there were no injuries or incidents on the site during construction.

35

Mr Allchin stated that his investigation into Mr Korol's accident identified a number of contributing factors, including poor communication which contributed to work having commenced without a safety fence being installed. He said this occurrence was not consistent with the corporate defendant's practices prior to the incident, nor its practices after the incident and its philosophy to ensure safe work sites.

Report of Mr Henkelman

36

Contained in a report of Mr Henkelman, Psychologist, dated 2 November 2010, is the personal defendant's family history. The personal defendant is aged 59. He was born in India and migrated to Australia via England in 1989. He has been married for 40 years and has two sons and four grandchildren. He has no other extended family living in Australia.

37

Mr Henkelman stated that the personal defendant was extremely traumatised by the incident and now qualifies for the diagnosis of Post Traumatic Stress Disorder with a Comorbidity of Depression. He listed five factors which are compounding the personal defendant's experience of the two diagnosable conditions. In summary, these were that the personal defendant has been a deeply religious man for his entire life.

38	Firstly, he follows a spiritual path that attracts a variety of religious beliefs, including Sikhism, Christianity, Buddhism and Islam. His beliefs regard human life as the top of creation and Mr Korol's death has played heavily on his conscience.

39	Secondly, he has had trouble meditating and following his spiritual beliefs. His difficulties with meditating have impacted upon his ability to show sufficient contrition according to the standards of his religious beliefs.

40

Thirdly, he does not feel that he has any meaningful support because as head of his household, it is his responsibility, based on his cultural beliefs, to provide guidance and support. He has been unable to distract himself from the traumatic memories associated with the incident and has been unable to disclose his thoughts and feelings to his family.

41	Fourthly, the personal defendant's heart condition has deteriorated since the incident. His depression has contributed to this condition.

42	Fifthly, the loss of the personal defendant's father approximately two years before the incident has exacerbated his grief. He has been counselled by "an elder" of the church, but finds it limited in its effectiveness.

43	Mr Henkelman stated that the personal defendant had expressed an extraordinary degree of remorse for his involvement in the offence. He recommended certain medication and consultation with a psychiatrist.

44

In a subsequent report, Mr Henkelman said that the personal defendant presented as a very traumatised and psychologically unstable man with no previous exposure to the law, or to the many and varied psychological sequelae associated with such a serious situation involving the death of an innocent man on a work site for which the personal defendant had some degree of responsibility. Since the incident, his life has been dominated by intrusive distressing recollections of the events with a complete inability to function psychologically. The personal defendant is very dependent upon those around him. He has lost all sense of his own identity. Mr Henkelman concluded by observing that the personal defendant has struggled greatly to regain any sense of self-esteem or self-worth as a result of the trauma he experienced by the incident.

45	Associate Professor M A Fitzpatrick, Cardiologist, confirmed in a report dated 5 November 2010 that the personal defendant suffers from Coronary Artery Disease and underwent bypass surgery in October 2003.

46

References were also provided by Pradeep Reniga, the Chairman of RSSB. He stated he has known the personal defendant for 20 years; he said he has lived an exemplary life and has given time and financial support on a regular basis to the less fortunate in the community. He observed that his company has taken remedial action to ensure that all safety requirements are met. He stated that the personal defendant has shown much remorse for what had occurred. He was upset that a human life was taken so early and under such circumstances.

47	Two further references from the Director of Benchmark Building Certifiers and Wilpa Electrical Service were also relied upon.

Relevant Principles

48	The Full Bench in Morrison v Coal Operations Australia Ltd (No 2) [2005] NSWIRComm 96; (2005) 141 IR 465 succinctly summarised the principles to be applied in determining sentence for an offence under the OHS Act . Their Honours stated at [8] - [15]:

[8] The overall approach to be followed in relation to the determination of sentence is to be found in the first instance within the statutory provisions of the Crimes (Sentencing Procedure) Act 1999 and in particular, in relation to these proceedings, ss 3A Purposes of Sentencing and 21A Aggravating, mitigating and other factors in sentencing.

[9] In R v Way [2004] NSWCCA 131; (2004) 60 NSWLR 168 it was emphasised that the provisions of the Crimes (Sentencing Procedure) Act referred to above are not to be construed as representing "a departure from settled principles of sentencing practice, or an abandonment of the discretion that is essential to any system calling for individualised justice". As was said at [59]:

'[I]t is clear that the legislative policy ... so far as that can be discerned from the legislation itself, was not to create a straight jacket for judges ... but rather [was] intended to provide "further guidance and structure to judicial discretion.'

[10] The starting point for consideration as to penalty is the objective seriousness of the offence. That is a well established sentencing principle and was conclusively affirmed in the Full Bench decision in Lawrenson Diecasting Pty Ltd v WorkCover Authority (NSW) (1999) 90 IR 464 at 474 as follows:

'[I]t is important to reiterate that the primary factor to be considered when a judicial officer is determining the appropriate sentence to impose is the objective seriousness of the offence charged. 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' ...

[11] The principle of foreseeability as a factor in determining the objective seriousness of an offence as part of the sentencing process was considered in the Full Bench decision in Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 at 646; 99 IR 29 at 62 as follows:

'The question of foreseeability is relevant to the assessment of the seriousness of the offence. We consider that the appropriate approach is that of Walton J, Vice President, in Department of Mineral Resources of NSW (McKensey) v Kembla Coal and Coke Pty Ltd (1999) 92 IR 8 at 27:'

'Whilst the reasonable foreseeability of an accident may not be relevant to the question of liability under the Act (see Drake Personnel Ltd t/a Drake Industrial v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 432), the degree of foreseeability is a significant factor to be taken into account when assessing the level of culpability of the defendant. The existence of a reasonably foreseeable risk to safety which is likely to result in serious injury or death is a factor which will be relevant to the assessment of the gravity of the offence.'

[12] On the issue of foreseeability, the Full Bench in Capral also stated at 646; 62 - 63:

'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. So much is clear from the structure and language of the section which is premised on the requirement to 'ensure ... health, safety and welfare at work' and the decided cases which make plain the nature of the obligation.'

[13] It is also necessary to consider the damage and injury suffered in the context of the evidence and "in light of the principles which have been laid down in relation to the relationship between the seriousness of injuries which have been suffered, or which may have been suffered, and the gravity of the offence" ( Capral at 650; 66). On that point the Full Bench in Capral stated:

'We consider that the relevant principle can be stated in this way. The gravity of the consequences of an accident, such as the damage or injury, does not, of itself, dictate the seriousness of the offence or the amount of penalty. However, a breach where there was every prospect of serious consequences might be assessed on a different basis to a breach unlikely to have such consequences. The occurrence of death or serious injury may manifest the degree of seriousness of the relevant detriment to safety: Tyler v Sydney Electricity (1993) 47 IR 1 at 5, Inspector Hannah v Wonar Pty Ltd (1992) 34 AILR 377 at 378, Watson v Southern Asphalters Pty Ltd (1996) 83 IR 446 at 456, Wong v Melinda Group Pty Ltd (1998) 82 IR 118 at 131, WorkCover Authority of New South Wales v Albury City Council (1999) 90 IR 397 at 408 - 409, Lawrenson Diecasting Pty Ltd (at 476), WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Ltd (at 428) and WorkCover Authority (NSW) v Walco Hoist Rentals Pty Ltd (No 2) (at [22]).'

[14] The principles of general and specific deterrence are also relevant in sentencing. The approach to be taken on that issue was also dealt with in some detail in Capral at 643 - 645; 59 - 62. Without detailing all that the Full Bench had to say we consider the approach to deterrence in the sentencing process is encapsulated in the following passage from the Full Bench in Capral at 644; 60 as follows:

'[B]oth 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, Workcover Authority (NSW) v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39; (2000) 99 IR 163 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.'

[15] In the con text of the above well established sentencing principles it will also be necessary to have regard to those general matters going to aggravation, mitigation and other factors identified in s 21A of the Crimes (Sentencing Procedure) Act relevant to the respondents before the Full Bench. As was said in R v Way at [56]:

'[I]t 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).'

Consideration

49

Counsel agreed that the primary consideration in sentencing requires a determination of the objective seriousness of the offence in accordance with the above principles. This involves examining the nature and quality of the offence, as set out in the agreed statement of facts, and the evidence. Without repeating what is contained in the agreed statement of facts and the evidence, in considering the seriousness of the offence, it is relevant to set out the important matters.

50

The available evidence clearly indicates that the defendants failed to take measures that were reasonably practicable to ensure the premises were safe and without risk to the health of persons who were not employees. The risk of a person entering the unfenced site and falling into one of 17 uncovered pier holes was obvious and clearly foreseeable. So much was identified in the corporate defendant's SWMS' for the Telstra site. However, such policies were not addressed in respect of the site the subject of the incident.

51

The personal defendant attended the site on 12 August 2008 and observed the pier holes. He contacted TFH Fencing to arrange for a perimeter security fence to be installed as the premises were unsecured. I accept that it was the corporate defendant's usual practice to have perimeter fencing in place at building sites. However, this site should never have been left unfenced after the pier holes were dug. Suitable fencing should have been erected at the time work commenced at the site. At the very minimum, to avoid risk, the pier holes should have been covered, which occurred after the incident.

52

The fencing that was ordered by the personal defendant on 12 August 2008 was booked to be installed on 14 August 2008. Enquiries by Inspector Hinton revealed that it would have been possible to have had perimeter fencing delivered to the premises on 12 August 2008, however, a surcharge would have been incurred.

53

The personal defendant made no arrangements to secure the premises with the exception of the safety tape on 12 August 2008, as he believed that a contractor, Mr Sean Teague was going to return to the premises that afternoon to have the pier holes filled with concrete. Mr Teague left the site at approximately 3.00pm. He provided the personal defendant and another contractor, Mr Matthew Reitsma, with a roll of red and white safety tape marked with the word "danger" to be put up at the premises. The personal defendant asked Mr Reitsma to place the safety tape around the external perimeter of the premises when he finished work for the day. The personal defendant left the premises at approximately 4.00pm whilst it remained unsecured and the pier holes uncovered. It should have been obvious to the personal defendant at the time he left the site, that the pier holes were not going to be filled that day.

54	The only "barrier" surrounding the premises at the conclusion of work on 12 August 2008, was the safety tape that had been put around the external perimeter of the premises. Mr Nematalla acknowledged that the foreseeability of the pier holes being left uncovered causing harm was "a given".

55	Mr Nematalla characterised the personal defendant's action as:

[A] shortcoming that can also be characterised as a simple lapse in judgment. What else could it be? A hitherto good citizen, and a corporate one at that, who has always practised safety. What could it be but a lapse in judgment based on the mistaken belief, having ordered the fence, there would be people there, workmen in particular, who would look after that. That does not excuse the conduct. He embraces his culpability and accepts the seriousness of it.

56

I reject the contention that what has occurred here could be described as a "simple lapse in judgment". The obligations under the OHS Act are to ensure the health and safety of both employees and non-employees. Fisher CJ observed in Inspector Milligan v Roads and Traffic Authority (Industrial Court of New South Wales, 29 August 1996, unreported) at 13 - 14 "No precautions of any kind were taken... The accident and death of Dr Cremona should not have happened. I can find nothing of excuse in the narrative given. ... The neglect of well known precautions in circumstances where there was every indication of a major risk of injury takes this matter towards a "worst case" category." The failure by the defendants to take any precautions, steps or measures in respect of the hazards present in this matter similarly places it in the "worst case" category.

57

There was clearly a neglect of well known precautions or measures that should have been taken, in particular, the immediate installing of a perimeter fence. It is to be remembered that there were 17 uncovered pier holes of approximately 450mm in diameter and approximately 1.80m - 2.0m deep in a residential area.

58

Furthermore, there was no adequate risk assessment conducted by the corporate defendant to determine the hazards and the level of risk posed by leaving the premises unsecured and the pier holes exposed. In addition, there was no site specific safety plan in relation to working with exposed pier holes and ensuring the premises were secured against unauthorised access. Apart from the unfurling of the safety tape, the premises were left unsecured after work had ceased on 12 August 2008.

59

The gravity or otherwise of the potential risks to safety flowing from a breach is relevant as a measure of the gravity of the breach and culpability: Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 at 476; Rodney Morrison v Powercoal Pty Ltd [2003] NSWIRComm 416; (2003) 130 IR 364 at [31] - [33]; Maddaford v CSR Limited and Mulgoa Quarries Pty Ltd [2004] NSWIRComm 337 at [17] and Sacco Builders Pty Ltd v Inspector Chaston [2009] NSWIRComm 153; (2009) 188 IR 79, Boland P and Staff J, (Marks J dissenting).

60

Although damage or injury to employees, or non-employees does not, of itself, dictate the seriousness of the offence or penalty, a breach where there was every prospect of serious consequences, may be assessed on a different basis to a breach unlikely to have such consequences. In such a case, the occurrence of death or serious injury, may manifest the degree of seriousness of the relevant risk: Maddaford v CSR Limited [17] - [18]. See also Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 99 IR 29 at [94] - [95]; WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Ltd [2000] NSWIRComm 1123; (2000) 95 IR 383 (at 428); Morrison v Powercoal Pty Ltd at [32]. In the present case, Mr Korol died from asphyxiation.

61

In addition, there were a number of simple remedial steps which could have been taken by the defendants to avoid the risk to safety. These included ensuring that the pier holes were covered; ensuring that the premises were secure by having perimeter security fencing in place; ensuring that risk assessments were undertaken to determine the hazard and level of risk posed by leaving the premises unsecured and the pier holes exposed; instructing sub-contractors working at the premises that pier holes that had been dug were to be covered or protected by temporary covers prior to work ceasing; ensuring there was a site safety plan in place at the premises in relation to the works being undertaken, and in particular working with exposed pier holes and ensuring the premises were secured against unauthorised access.

62	I note that the corporate defendant after the incident, took steps to put in place systems of work to ensure that persons were not exposed to risks on their building sites.

63	I agree with Mr Ginters that these offences should be assessed as being serious and at the mid to upper range of penalty available to be imposed on offenders.

General deterrence

64

As to general deterrence, I consider it is once again essential to draw to the attention of employers, contractors, and controllers of building sites, the need to be constantly vigilant and to ensure that employees and non-employees are not exposed to risks to their health and safety through work being carried out on either residential or commercial building sites. A common feature of building sites should be perimeter fencing. I would observe that although the defendants had occupational health and safety procedures in place at other sites, they failed to adhere to their own policies in respect to the site the subject of the incident. In my view, there should be a significant component in the penalty for general deterrence.

Specific deterrence

65

In relation to specific deterrence, although the corporate defendant is no longer operating in the construction industry, it remains a registered organisation and continues to operate in property development and real estate acquisition. I accept, in light of the evidence relied upon by the defendants, that this is not a case which calls for the imposition of some additional punishment aimed at deterring the defendants from further offending against the OHS Act and/or for the purpose of compelling the defendants' attention to Occupational Health and Safety issues. Mr Nematalla submitted that the need for specific deterrence was "somewhat diluted". As the defendant is still operating, I include a component in the penalty for specific deterrence.

Subjective factors

66	The principle in respect of subjective factors was summarised by the Full Bench in Lawrenson Diecasting Pty Ltd at 475:

As we have observed, the primary factor to look at in relation to the penalty to be imposed is the objective seriousness of the offence. Particularly in cases involving a serious breach of the OH&S Act, subjective factors, such as a plea of guilty, co-operation with the investigation and subsequent measures taken to improve safety, must play a subsidiary role in the determination of penalty to the gravity of the offence itself. While the Court must keep in mind not only facts which establish the seriousness of the offence, but also those which tend to mitigate that seriousness or exculpate the offender (see Camilleri's Stock Feeds Pty Ltd v Environmental Protection Authority (1993) 32 NSWLR 683 at 698 per Kirby P), the presence of the subjective factors referred to should not be permitted to produce a sentence which fails to adequately reflect the seriousness of the offence.

67

The relevant subjective factors include that the corporate defendant has been in operation in Australia for 20 years, and previously in the United Kingdom for 20 years in a notoriously dangerous industry in which it has no previous convictions under the OHS Act or the relevant legislation in the United Kingdom.

68	I find that the corporate defendant is entitled to be regarded as a good corporate citizen, as is the personal defendant.

Remorse and contrition

69	Section 21A(3)(i) of the Crimes (Sentencing Procedure) Act 1999 (" CSP Act ") provides that "remorse" may be taken into account as a mitigating factor if and only if:

(i) the offender has provided evidence that he or she has accepted responsibility for his or her actions, and

(ii) the offender has acknowledged any injury, loss or damage caused by his or her actions or made reparation for such injury, loss or damage (or both).

70	In Cahill v State of New South Wales (Department of Community Services) (No 4) [2008] NSWIRComm 201; (2008) 182 IR 231, Boland P stated at [62]:

[62] A simple expression of contrition or remorse by a representative of a corporate offender, no matter how senior the representative, is not enough to enable the Court to find that the offender is remorseful: As Cummins J said in DPP v Esso Australia Pty Ltd [2001] VSC 263; (2001) 124 A Crim R 200, "personal expressions of remorse need to be translated into reality". See also see Regina v Heip Tan Nguyen [2004] NSWCCA 438 per Bell J ( Hidden and James JJ agreeing) at [21]. There must be evidence that the offender has accepted responsibility for its actions and also that the offender has acknowledged any injury, loss or damage caused by its actions or that it has made reparation for such injury, loss or damage (or both).

71

The evidence discloses that the defendants have accepted responsibility for their actions and also acknowledge the tragic loss of Mr Korol's life. The corporate defendant no longer operates in the construction industry. The evidence discloses that the personal defendant remains traumatised as a result of the accident. The defendants also accepted responsibility for their actions as demonstrated by the early pleas of guilty to both offences. It was common ground that neither the personal defendant, nor the corporate defendant have any prior convictions and as such are entitled to leniency as "first offenders" pursuant to s 21A(3)(e) of CSP Act .

72

As I have already observed, each defendant entered a plea of guilty at the earliest opportunity and are entitled to a discount of 25 percent in accordance with the principles in R v Thomson; R v Houlton (2000) 49 NSWLR 383. I also take into account the steps taken by the defendants to avoid the breach recurring and that the defendants co-operated with WorkCover.

73

Counsel for the defendants pointed to what I understood to be a contributing factor by Mr Korol to the incident. Counsel submitted that "this is an activity which was moved to by the deceased, if I can put it that way, this is, he actively moved to the hole, reached in and pulled out the dog". Counsel also pointed to the Forensic Medicine Final Report and that the toxicological analysis of samples taken from Mr Korol detected alcohol at a blood level of 0.058, marijuana and breakdown products in a number of medications. These were all at levels within or below the reported therapeutic ranges. The Report concluded that these substances were unlikely to have played a significant role in causing Mr Korol's death.

74

The contribution of other parties to an offence is a matter to be weighed in the consideration of the objective seriousness of the offence: WorkCover Authority (NSW) (Inspector Ankucic) v Lyndhurst Trading Co Pty Ltd at 434, 437 and WorkCover Authority of New South Wales (Inspector Farrell) v David Carl Schrader [2002] NSWIRComm 25; (2002) 112 IR 284 at [61].

75	In WorkCover Authority of New South Wales (Inspector Mulder) v Arbor Products International (Australia) Pty Ltd [2001] NSWIRComm 50; (2001) 105 IR 81, Walton VP and Boland J, (Kavanagh J dissenting) stated at [45] - [46]:

[45] The duty to provide a risk free work environment is a duty owed not only to the careful and observant employee but also to the hasty, careless, inadvertent, inattentive, unreasonable or disobedient employee in respect of conduct that is reasonably foreseeable: Dunlop Rubber Australia Ltd v Buckley [1952] HCA 72; (1952) 87 CLR 313 at 320; McLean v Tedman [1984] HCA 60; (1984) 155 CLR 306 at 311 - 312 and WorkCover Authority of NSW (Inspector Twynam-Perkins) v Maine Lighting Pty Limited (1995) 100 IR 248.

[46] We agree with the conclusions of the Full Bench in Riley v Australian Grader Hire Pty Ltd [2001] NSWIRComm 31 [at 15] as follows:

The magistrate appears to have reached her conclusion as to the objective seriousness of the offence, having regard to the lack of common sense of the injured worker. It is reasonably clear from her decision that it was concluded that the conduct of the injured worker effectively removed or minimised the liability of the respondent in relation to the lack of training or instruction afforded the employee. This was wrong in principle. Section 15 of the Occupational Health and Safety Act requires employers to be diligent and proactive to ensure the safety of employees. Those obligations are not diminished because of the error or negligence of an employee, although such matters may reflect on the degree of culpability of the employer for the purposes of sentencing. We note the following observations of Bauer J in WorkCover Authority of New South Wales (Inspector Twynam-Perkins) v Maine Lighting Pty Limited (1995) 100 IR 248 at 257:

"Much of what was urged by Mr King was directed to showing that the worker who was killed knew of, and therefore ought to have avoided the exposed electrical connections. In one sense such a submission militated against the position of the defendant; the very purpose of the Act was to introduce safe working practices so that accidents are prevented. The Act was designed to protect against human errors including inadvertence, inattention, haste and even foolish disregard of personal safety as well as the foreseeable technical risks in industry."

(See also WorkCover Authority of NSW (Inspector Hopkins) v Profab Industries Pty Ltd [2000] NSWIRComm 142; (2000) 49 NSWLR 700 at 722).

76

In my view, these well established principles are equally applicable to non-employees. Applying these principles, there is no basis, in my view, to conclude that the conduct of Mr Korol minimised the liability of the defendants. However, as the Full Bench observed "such matters may reflect on the degree of culpability of the employer for the purpose of sentencing".

Capacity to pay

77

Mr Nematalla submitted that the corporate defendant and the personal defendant had a limited capacity to pay fines. All that was provided to the Court in support of this submission was a one page letter from the defendants' accountant which confirmed that the personal defendant's income tax returns showed income of $33,946 in 2010; $12,782 in 2009; $33,064 in 2008; $65,327 in 2007 and $62,471 in 2006.

78	In respect of the corporate defendant's income tax returns and financial statements, these were said to show the following profits (losses): ($92,223) in 2010; ($537,827) in 2009; ($73,699) in 2008; $361,528 in 2007 and $300,115 in 2006. No other financial records were provided to the Court.

79

The principles to be applied in respect of an application under s 6 of the Fines Act , were discussed by me in Inspector Beacham v J & L Marble Pty Ltd [2009] NSWIRComm 100 at [57] - [58]. In that matter, I referred to the judgment of Walton J, Vice-President in WorkCover Authority of New South Wales (Inspector Farrell) v Schrader , where his Honour observed:

[83] The financial means of the defendant was a matter that was submitted in mitigation of penalty. In this regard I would adopt what I stated in Department of Mineral Resources v A M Hoipo & Sons (at par 50):

'It is proper, nonetheless, to have regard to the financial position and means of the defendant when considering the question of penalty: see Ferguson v Nelmac Pty Ltd (1999) 94 IR 188 at 209. The purpose of a fine is primarily to punish the offender. The burden which will be imposed by virtue of a fine at a particular level will, to some extent, depend upon the financial circumstances and resources of that offender. As a result, the amount and method of payment of a fine will need to take into account, as [2002] NSWIRComm 25; (2002) 112 IR 284 at 309 far as practicable, the financial resources and income of the defendant: see R v Sgroi (1989) 40 A Crim R 197 at 200-201.'

[84] This approach was subsequently adopted in Manpac Industries where the Full Bench of this Court stated (at pars 81-82):

'... Section 6 of the Fines Act 1996 provides that in exercising a discretion to fix the amount of any fine a court is required to consider the means of the accused and such other matters as are relevant to the fixing of that amount. That statutory injunction, of course, has long been recognised as an appropriate part of the sentencing process: see, for instance, Warman International (80 IR at 339); WorkCover Authority (NSW) (Inspector Dowling) v Overtop Pty Ltd (1998) 86 IR 319 at 333; and Profab Industries (49 NSWLR at 714; 100 IR at 76).

However, and given the primacy of the objective seriousness of an offence in determining an appropriate sentence, the financial situation of a defendant, in our view, needs to be carefully scrutinised. In Ferguson v Nelmac Pty Ltd (1999) 92 IR 188 at 209 - 210, Wrigh t J, President observed:

'... Whilst I accept that the imposition of heavy fines would be a burden on the defendant and its financial resources and that consideration should be given appropriate weight on the question of penalty, it does not necessarily result in the Court not imposing a heavy penalty. ......

When viewed in the context of the statutory mandate in s 15 the offences were very serious and provided proper weight is given to the subjective considerations and insofar as deterrence is concerned some tempering thereof, the penalty should reflect the objective seriousness of the offence. ...'

[85] I would reiterate what the Court stated in WorkCover Authority (NSW) (Inspector Ankucic) v Lyndhurst Trading Co Pty Ltd (2000) 95 IR 462 at 476:

'Where the means of the defendant to pay any fine is raised, the proper course will be to assess the appropriate amount of the fine having regard to the gravity of the offence charged and then reduce the fine to take into account the defendant's means and impecuniosity: see R v Rahme (1989) 43 A Crim R 81 at 86.'

(See also WorkCover Authority (NSW) (Inspector Hopkins) v Michael Wheritt t/a M J Wherritt Concrete Pumping Services [2002] NSWIRComm 16 at pars 59-60.)"

80	The Full Bench in WorkCover Authority of New South Wales (Inspector Robert Mayell) v D J Gleeson Pty Ltd [2006] NSWIRComm 363 reviewed various judgments where s 6 of the Fines Act was considered and observed at [35]:

[35] The relevant principles in relation to the application of s 6 of the Fines Act have been collected in a number of decisions in this jurisdiction. We adopt those principles in this judgment: Ferguson v Nelmac Pty Limited (1999) 92 IR 188 at 209; Department of Mineral Resources of NSW (Chief Inspector Terrey) v A M Hoipo & sons Pty Ltd (2000) 99 IR 137 at [48] - [51]; Manpac Industries Pty Ltd (formerly t/a Pacific Concrete & Quarries Pty Ltd) v WorkCover Authority of NSW (Inspector Glass) [2001] NSWIRComm 190; (2001) 106 IR 435 at [56] - [57], [67], [81] - [83]; Inspector Green v Camilleri Properties Pty Limited at [21]. Applying these principles, we do not consider that there is any proper basis for the application of s 6 of the Fines Act in this case.

81

During cross-examination, Mr Allchin's evidence was that the corporate defendant did not have any assets or any liabilities. His evidence was also that the company had no acquisitions and had not made any investments. He acknowledged that there had been no material placed before the Court in respect of the personal defendant's assets or liabilities. There was also evidence before the Court that the Telstra project was a $6 M project and that the corporate defendant owned the Glenmore Park property. No financial material was placed before the Court in respect of the outcome of the project or the property at Glenmore Park. In these circumstances, applying the above principles, I do not consider that there is any proper basis for the application of s 6 of the Fines Act in this case.

Victim impact statement

82	The CSP Act relevantly provides under s 28(1):

28 When victim impact statements may be received and considered

(1) If it considers it appropriate to do so, a court may receive and consider a victim impact statement at any time after it convicts, but before it sentences, an offender.

...

83

The Court of Criminal Appeal in R v Mansour [1999] NSWCCA 180 and Hunt CJ at CL in Previtera (1997) 94 A Crim R 76 (at 84 - 85) stated that the Court in sentencing may bear in mind a victim impact statement and have regard to the particular effect of the deceased on members of the family. However, the Court should not give these considerations weight in determining the sentence imposed: Inspector Glass v Foamex Polystyrene Pty Ltd [2004] NSWIRComm 100 at [43]. See also Inspector Simpson v Tomago Aluminium Co Pty Ltd ((unreported) Haylen J 27 April 2004 Matter No IRC 5351 of 2003); Inspector Sharpin v A Team Concrete (Aust) Pty Ltd & Ors [2004] NSWIRComm 182 at [138].

84

Mr Ginters provided the Court with a victim impact statement of Glenn James Sheridan dated 7 February 2011. Mr Sheridan stated that he had been in a relationship with Mr Korol for the past 15 years and they cohabitated as partners. Mr Sheridan said he had been terribly upset and significantly depressed since the death of his partner. He has not been able to get back to his normal occupation as a courier driver and has not worked much at all since Mr Korol's death. He has suffered significant agoraphobia and has great difficulty leaving the house.

85

Since Mr Korol's death, Mr Sheridan has consulted psychologists and grief counsellors, which have mostly been arranged by the WorkCover. He says he is still suffering a lot of psychological problems which he believes have been caused by his partner's death. He has undergone psychological counselling on 20 occasions since the incident. He has an appointment to see a psychiatrist on 23 February 2010 [sic].

86	The Court extended its sympathy to Mr Sheridan for the tragic loss of his partner.

Comparison of sentences

87

Mr Nematalla provided to the Court a schedule setting out statistics in respect of a comparison of imposed penalties as a percentage of the maximum penalty of all corporate defendants between September 1989 and 2004. He acknowledged that they did no more than show a measure of consistency in sentencing and that the statistics did not take into account the facts and circumstances of each case.

88

It has been held on a number of occasions by this Court and the Supreme Court of New South Wales, Court of Criminal Appeal that comparisons with sentences passed in other cases is not helpful. See Director of Public Prosecutions (Cth) v De La Rosa [2010] NSWCCA 194; (2010) 243 FLR 28 at [303]. In WorkCover Authority (NSW) (Inspector Mason) v Wild Geese Building and Maintenance Group Pty Ltd [2006] NSWIRComm 350; (2006) 157 IR 313, the Full Bench observed at [38]:

[38] Nothing in her Honour's judgment explains how this very serious offence resulted in a penalty of less than five per cent of the maximum available. While the appellant argued that the explanation must be that too much weight was given to subjective matters, that is not apparent from her Honour's judgment. We consider that there are real difficulties in comparing penalties imposed under the Occupational Health and Safety Act , even in cases where there is an essential common feature, such as a falling incident, crushing incident etc, because of the myriad of differing surrounding factual circumstances in the cases. ...

See also Nelmac Pty Ltd v Franke (Inspector) [2006] NSWIRComm 100; (2006) 151 IR 63; Inspector Jelley v Albright & Wilson (Australia) Limited [2007] NSWIRComm 148; (2007) 164 IR 456.

Section 10 application

89	Mr Nematalla made an application for the exercise of the Court's discretion under s 10(2) of the CSP Act on behalf of the personal defendant. Section 10 of the CSP Act is in the following terms:

10 Dismissal of charges and conditional discharge of offender

(1) Without proceeding to conviction, a court that finds a person guilty of an offence may make any one of the following orders:

(a) an order directing that the relevant charge be dismissed,

(b) an order discharging the person on condition that the person enter into a good behaviour bond for a term not exceeding 2 years,

(c) an order discharging the person on condition that the person enter into an agreement to participate in an intervention program and to comply with any intervention plan arising out of the program.

(2) An order referred to in subsection (1) (b) may be made if the court is satisfied:

(a) that it is inexpedient to inflict any punishment (other than nominal punishment) on the person, or

(b) that it is expedient to release the person on a good behaviour bond.

...

(3) In deciding whether to make an order referred to in subsection (1), the court is to have regard to the following factors:

(a) the person's character, antecedents, age, health and mental condition,

(b) the trivial nature of the offence,

(c) the extenuating circumstances in which the offence was committed,

(d) any other matter that the court thinks proper to consider.

90

The application of this section has been considered by a number of Full Benches of this Court. See WorkCover Authority of New South Wales (Inspector Hopkins) v Profab Industries Pty Ltd [2000] NSWIRComm 142; (2000) 100 IR 64; Riley v Australian Grader Hire Pty Ltd [2001] NSWIRComm 31; (2001) 103 IR 143; WorkCover Authority of New South Wales (Inspector Downie) v Menzies Property Services Pty Limited [2004] NSWIRComm 259; (2004) 136 IR 449; WorkCover Authority (NSW) (Inspector Shaw) v Du Pont (Australia) Pty Ltd [2006] NSWIRComm 116; (2006) 152 IR 68; T and M Industries (Aust) Pty Ltd and Anor v WorkCover Authority (NSW) (Inspector Sequeira) [2006] NSWIRComm 25 ; (2006) 151 IR 130.

91	These authorities provide that a s 10 application will be available only in rare and limited circumstances in proceedings under the OHS Act . In Profab , for example, the Full Bench stated at [26]:

Nevertheless, in occupational health and safety offences before this Court the exercise of the discretion under s 556A (cf s 10 of the Crimes (Sentencing Procedure) Act 1999) must be considered as extraordinary and highly exceptional. When a defendant seeks its exercise cogent reasons must, in our view, be provided by the defendant for such exercise and also by the judge acceding to that submission. The obligation is increased rather then diminished in a situation, such as the present, where the exercise of the discretion is not sought by the defendant but raised by the Court.

92

Shortly stated, the personal defendant is required to advance extenuating circumstances in which the offence was committed. This may include evidence as to age, health, or mental condition, all being matters I am required to have regard to pursuant to s 10(3) of the CSP Act , in addition to antecedents and whether the offence was trivial, together with any other matters that the Court may regard as relevant to consider.

93

In light of the objective seriousness of the offence, and noting in particular that the personal defendant was present at the site on the afternoon of 12 August 2008, there is no proper basis for the exercise of my discretion under s 10 of the CSP Act . The application lacks the exceptional or extraordinary features required for such an application to be granted.

Maximum penalty

94	In determining penalty in these matters, it is important to restate that careful attention must be given to the maximum penalty.

95	In Sacco Builders Pty Ltd v Inspector Chaston , the majority, Boland P and Staff J, (Marks J dissenting) observed as follows at [55]:

Recently, Walton J Vice-President in Inspector Howard v Baulderstone Hornibrook Pty Ltd [2009] NSWIRComm 92, in an extensive review of the principles applicable in occupational health and safety sentencing matters, observed in respect of determining the maximum penalty as follows at [192]:

(i) Maximum Penalty

In Morrison v Powercoal (2005) (at [16] and [17]), the Full Bench observed that a fundamental consideration in determining penalty is the maximum penalty for an offence. In R v Moon [2000] NSWCCA 534; (2000) 117 A Crim R 497 at [70], Howie J described "the nature of the criminal conduct proscribed by an offence and the maximum penalty applicable to the offence" as being "crucially important factors in the synthesis which leads to the determination of the sentence to be imposed upon the particular offender for the particular crime committed". Wright J, in Walco (at [23]), described the task of the Court in sentencing as "assessing the relative seriousness of the offender's particular offence in relation to the worst case for which the maximum penalty is provided" (see Independent Cargo at 4). Ultimately, maximum penalties will have significance in sentencing in accordance with the statement of the High Court of Australia (per Gleeson CJ, Gummow, Hayne and Callinan JJ) in Markarian v The Queen [2005] HCA 25; (2005) 228 CLR 357 at [30] and [31] as follows:

Legislatures do not enact maximum available sentences as mere formalities. Judges need sentencing yardsticks. It is well accepted that the maximum sentence available may in some cases be a matter of great relevance. In their book Sentencing , Stockdale and Devlin observe that:

'A maximum sentence fixed by Parliament may have little relevance in a given case, either because it was fixed at a very high level in the last century ... or because it has more recently been set at a high catch-all level ... At other times the maximum may be highly relevant and sometimes may create real difficulties ... A change in a maximum sentence by Parliament will sometimes be helpful [where it is thought that the Parliament regarded the previous penalties as inadequate].'

It follows that careful attention to maximum penalties will almost always be required, first because the legislature has legislated for them; secondly, because they invite comparison between the worst possible case and the case before the court at the time; and thirdly, because in that regard they do provide, taken and balanced with all of the other relevant factors, a yardstick. That having been said, in our opinion, it will rarely be, and was not appropriate for Hulme J here to look first to a maximum penalty, and to proceed by making a proportional deduction from it. That was to use a prescribed maximum erroneously, as neither a yardstick, nor as a basis for comparison of this case with the worst possible case...

And at [56]:

... It is most important that sentencing under any regime be done against the maximum penalty, not on the basis of what is thought to be fair in any case.

96	Earlier, in Inspector Stephen Campbell v James Gordon Hitchcock [2005] NSWIRComm 34; (2000) 139 IR 439, Walton J referred to the principles in respect of the imposition of the maximum penalty and worst cases. His Honour observed at [44] - [45]:

[44] The principles relating to the imposition of the maximum penalty were discussed in WorkCover v McDonald's at [141]:

141 Furthermore, a number of principles may be identified in relation to the maximum penalty for the offence:

1. The maximum penalty in a general way indicates the seriousness which Parliament, representing the people, has viewed the offence and represents the starting point for the assessment of penalty as representing the worst case in the class of the defined offence: Director of Public Prosecutions (Cth) v Said Khodor El Karhani (1990) 21 NSWLR 370 at 380;

2. The maximum penalty may be appropriate where the level of culpability is so extreme that the community interest in retribution and punishment can only be met by such a punishment. The maximum penalty for any offence is a sentencing option reserved for cases which can be properly characterised as falling within the worst category of cases for which that penalty is prescribed: R v Vusumuzi Twala (unreported, Court of Criminal Appeal, Matter No. 60187 of 1993, 4 November 1994 at 2); R v Dodd (1991) 57 A Crim R 347 at 354. Such a case must involve an absence of any facts mitigating the objective seriousness of the crime (as distinct from any subjective features mitigating the penalty to be imposed): Kalajzich (1997) 94 A Crim R 41 at 51; Fernando v Fernando (1997) 95 A Crim R 533 at 536. It was pointed out by the Full Court of the Industrial Court of New South Wales in Independent Cargo and Wool Services at 4:

The maximum penalty is designed to furnish out one end of the scale. Thus whilst penalties should not be compared in terms of some mathematical ratio "it must be true that in any given case the area available for consideration must be measured between no imposition of a penalty at one end and the maximum at the other. (at 4)

3. However, it does not follow that a lesser penalty than the maximum must be imposed if it is possible to envisage a worst case (see earlier extract from Camilleri's Stock Feeds ; see also Saffron (No 3) (1989) A Crim R 123 at 126); Twala at 2.

4. A sig n ificant increase in the maximum penalty represents the level of community concern about conduct proscribed under the Act which should be reflected in the sentences which trial courts impose: see R v Jurisic [1998] NSWSC 423; (1998) 101 A Crim R 259 at 274; R v Slattery (1996) 90 ACrimR 519 at 524; Ferguson v Nelmac Pty Ltd .

See also R v Way [2004] NSWCCA 131; (2004) 60 NSWLR 168 at [51].

[45] The following complete passage of the judgment of the Full Bench of the Court of Criminal Appeal in R v Vusumuzi Twala (per Badgery-Parker J, with whom Carruthers and Finlay JJ agreed, unreported, Court of Criminal Appeal, 4 November 1994, at page 7) is illuminating:

However, in order to characterise any case as being in the worst case category, it must be possible to point to particular features which are of very great heinousness and it must be possible to postulate the absence of facts mitigating the seriousness of the crime (as distinct from subjective features mitigating the penalty to be imposed).

97	I propose to be guided by these principles in determining sentence.

98

The maximum penalty in respect of the corporate defendant is $550,000. The maximum penalty in respect of the personal defendant is $55,000. Taking into account the appropriate seriousness of the offences and the subjective factors referred to earlier, I impose a fine of $250,000 on the corporate defendant. I impose a fine of $25,000 on the personal defendant.

ORDERS

99	I make the following orders:

Matter No IRC 762 of 2010

1. The offence is proven and a verdict of guilty is entered.

2. The corporate defendant is convicted of the offence, as charged.

3. The corporate defendant is fined an amount of $250,000 with a moiety thereof to the prosecutor.

4. The corporate defendant shall pay the prosecutor's costs of the proceedings in an amount as agreed, or if agreement cannot be reached, as assessed.

Matter No IRC 763 of 2010

1. The offence is proven and a verdict of guilty is entered.

2. The personal defendant is convicted of the offence, as charged.

3. The personal defendant is fined an amount of $25,000 with a moiety to the prosecutor.

4. The personal defendant shall pay the prosecutor's costs of the proceedings in an amount as agreed, or if agreement cannot be reached, as assessed.

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