Director of Public Prosecutions v Fergusson; Director of Public Prosecutions and Jacbe Pty Ltd (First Revision)

[2017] VCC 1276

IN THE COUNTY COURT OF VICTORIA

Revised

Not Restricted

Suitable for Publication

AT MELBOURNE

CRIMINAL JURISDICTION

CR-16-01030

CR-16-01031

DIRECTOR OF PUBLIC PROSECUTIONS

v

DAVID FERGUSSON

and

DIRECTOR of PUBLIC PROSECUTIONS

v

JACBE BUILDERS PTY LTD

---

JUDGE:	HER HONOUR JUDGE CANNON
WHERE HELD:	Melbourne
DATE OF HEARING:	17 August 2017
DATE OF SENTENCE:	5 September 2017
CASE MAY BE CITED AS:	DPP v Fergusson; DPP and Jacbe Pty Ltd (First Revision)
MEDIUM NEUTRAL CITATION:	[2017] VCC 1276

REASONS FOR SENTENCE

---

Subject:  CRIMINAL LAW

Catchwords:  Sentence – Pleas of guilty – Being an officer of a body corporate that failed to provide and maintain a safe working environment by failing to take reasonable care (Fergusson) – Failing to provide and maintain a safe working environment (Jacbe Builders Pty Ltd) – Accused Fergusson Director of Jacbe Builders Pty Ltd now in liquidation – Collapse of partially built apartments - Workplace death - Departure from acceptable safety standards

Sentence:Accused Fergusson – convicted and fined $180,000; Accused Jacbe Builders Pty Ltd convicted and fined $700,000 – s.6AAA Sentencing Act 1991 declared

---

APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Mr A. Palmer with Mr D. Chisholm	Solicitor for Public Prosecutions
For both Accused David Fergusson and Jacbe Builders Pty Ltd	Mr R. Taylor	Ebsworth Lawyers

HER HONOUR:

1David Shane Fergusson, you have pleaded guilty to the offence of being an officer of a body corporate that failed to provide and maintain a safe working environment by failing to take reasonable care, and you have also pleaded guilty on behalf of Jacbe Builders Pty Ltd, (which I will refer to as "the company" from time-to-time) of failing to provide and maintain a safe working environment.

2The maximum penalty for the first mentioned offence is 1800 penalty units, which translates to $259,484, and for the second mentioned offence, 9,000 penalty units, which amounts to $1,299,240.  The maximum penalties reflect the seriousness with which Parliament regards each of these offences.

3The matter was opened by the prosecution as follows:

4On 22 August 2013, three packs of floor sheeting were craned onto the second floor trusses of a partially-built apartment building in Caulfield.  Shortly after this, the second floor trusses collapsed onto the first floor, then both floors collapsed onto the ground level.

5I was told that you, Mr Fergusson, a registered builder, and your apprentice,
Mr Nick Mackenzie, had been working on the second floor.  I was told by Mr Taylor that you had asked Mr Mackenzie to retrieve a nail gun from the ground floor when the collapse occurred.  You fell with the debris to the ground.  Tragically, Nick Mackenzie was killed under the weight of the debris, his chest being crushed to the point of him being asphyxiated.

6By way of background, I was told that a Yuri Chiorny was the principal builder, having obtained a building permit for the relevant site.  Mr Chiorny subcontracted a number of the aspects of the project.  You and your company were engaged to do the carpentry work.

7I was told that Bradcoe Trusses Pty Ltd, who made trusses under licence from Pryda Pty Ltd had provided a quote for the floor trusses for the project.  Bradcoe then prepared drawings for the first and second floor trusses using engineering calculations previously prepared by a Mark Ziety.  The calculations specified the design live load for the floors, and provided that the trusses were to be designed and fixed in accordance with manufacturers' requirements.  Bradcoe did not manufacture the trusses themselves, but ordered these from another company licenced by Pryda, ‘The Victorian Truss Company Ltd’.

8After the foundation had been laid and the block wall built to just above a level of the first floor, you, Mr Fergusson, and your apprentice Mr Nicholas Mackenzie, installed the first floor trusses and laid the first floor.  After this, the block was completed up to the second level.

9On 20 August 2013, you and Nicholas Mackenzie returned to the site to commence the carpentry for the second floor, which included installing the second floor trusses.  Mr Chiorny then ordered 42 sheets of yellow tongue flooring from Moorabbin Timber Pty Ltd.  The sheets were to be split into three packs of 14 sheets each.

10Moorabbin Timber subcontracted the delivery of flooring to Patterson Cranes Pty Ltd.  You met Mr Patterson, who was a driver for the crane company on this day, at the building site, and guided him to the rear of the laneway which was adjacent to the building site.  You instructed Mr Patterson to lift one pack of the sheets at a time, and to place them on the second floor trusses.  Mr Patterson relied on you to guide him as to where the flooring was to be placed. 
Mr Patterson placed the first pack of flooring in the centre of the rear trusses, and placed the second pack on top of the first.  Both packs protruded beyond the last truss by about 900 mm.  Mr Patterson placed the third pack of flooring to the right-hand side of the first two packs.  He left the site at 9.30 am. 

11As I said previously, the second floor collapsed, and Nicholas Mackenzie and you were found under the rubble by others at the site, including Mr Chiorny.  Despite the efforts of emergency workers and passers-by to remove the debris, Nicholas Mackenzie had passed away.  You were conscious and responding. 

12The prosecution alleges that the incident was caused by the overloading of the second floor trusses with the three packs of flooring.  I understand that you accept the prosecution opening, and in doing so, you accept that this is the case.

13I regard the offending in this matter as objectively most serious.  Your and your company's conduct was a significant departure from acceptable safety standards.  It is fairly obvious, I would have thought, that if you place a significant weight on trusses without any regard to the load the trusses can withstand, you are taking a most significant risk that the trusses will collapse.  You may have been lucky on a past occasion where this did not occur, which may well have emboldened you on this occasion, but the significant risk was always there by such a dangerous practice.

14In this regard, I was told that there is a good deal of material available in the construction industry in respect of safety standards associated with this area.  While it may be that such material is more readily applicable or available to large construction companies and the projects that they undertake, I can see no reason why smaller companies, such as yours, would not be familiar with best practice, and do what you can to comply with it.

15The foreseeable potential consequences of your and your company's conduct was death or serious injury.  Clearly this was so, such consequences materialising on this occasion in the tragic death of Mr Mackenzie.  You also sustained injury, and I will refer to this a little later.  I make it clear that in assessing the seriousness of your and the company's respective breaches, I have not assumed a high degree of seriousness because Mr Mackenzie was killed, or because you were seriously injured for that matter.  However, in this particular case, Mr Mackenzie's death and your injuries help inform the existence, nature and seriousness of the risk involved in what you and the company did and failed to do on the occasion in question.

16I also accept the Crown's submission that it was very likely that the trusses would collapse if overloaded, and it was reasonably practicable to adopt a far safer practice.  You were a registered builder, and ought to have been aware of the risk and safety measures that could be used to eliminate or reduce such risk of death or serious injury.

17As referred to in the further particulars of the charges, it was reasonably practicable for your company to have its employees spread materials, such as spreading the floorboards, across the trusses as they were unloaded.  The financial cost of such a measure would have added nothing to your expenses.

18While I accept that you are not the principal builder for this job, this did not relieve you of the responsibility of ensuring that the workplace for your employees was as safe as was reasonably practicable.  I understand that as you are not the principal builder, you did not receive the structural drawings.  However, you were not precluded from asking for these in circumstances where it was your role to direct the delivery of the flooring.

19I accept that this was not a case of you being aware that there was a significant risk involved in what you did, but ignoring it.  If this had been the case, your moral culpability and that attributed to the company would have been even higher than it already is.

20Unfortunately, you did not have any appreciation of the risk associated with placing the flooring bundles on the trusses in the way that you did.  Obviously, as a registered builder, this is something that you should have been aware of, and taken appropriate steps to deal with, so as to maximise the safety of your employees.

21I must place strong weight on general deterrence in a bid to deter others from engaging in similar offending conduct, and I must impose a punishment upon you and the company, although it is no longer trading and about to go into liquidation-  A punishment which is just in all the circumstances. 

22Employers must do whatever they reasonably can to provide safe workplaces for their employees, no matter how large or small their businesses may be, and no matter whether they are the principal builder or subcontractor.  They must be dissuaded from adopting a "She'll be right" attitude, rather than putting in the time and effort to adopt best practice in the workplace. This is especially so in workplaces such as those in the construction industry, where there are often significant potential dangers involved in the work environment.  Clearly, the offending in this case highlights such danger.

23I take into account the victim impact statements, which were read aloud in court.  They are heart-wrenching expressions of the grief and torment suffered by the loved ones that Nicholas Mackenzie has left behind.

24Nicholas' mother, Debra Mackenzie, said that she had a strong and special relationship with her son- that he had good values, and was extremely loyal to his family and friends, and to his work.  She spoke of his ability to light up a room, and to be able to engage with people of all ages.  Mrs Mackenzie said that Nicholas was very excited to obtain an apprenticeship, as he had wanted to become a builder from a very early age.

25She said that when she lost her son, part of her died.  She dreaded going to bed, because waking up meant that she would have to face another day. 
Mrs Mackenzie spoke of her feelings of depression and anxiety since Nicholas' death, and says that losing her son had caused her to lose trust in people, and that her faith in relationships has been shaken, as she fears being hurt again.  She spoke of the slow progress of this matter through the courts, and the harsh impact that your and your company's changes in plea have had upon her. 

26She said that although she would have liked to have heard all the evidence in this case, she was relieved that she did not have to endure a trial.  She has experienced a lack of understanding by her own employer, and has been under a great deal of pressure due to the time she has had to take off work to attend the various hearings.

27Mrs Mackenzie expresses immense anxiety when the phone rings nowadays, as she fears it will be more bad news, and she stresses when she cannot contact her other children.  She spoke of her emotional turmoil and ruminations over what might have been, and said that she has lost the chance to share in her son's success and future happiness.

28Mrs Mackenzie said that she did not want her son's death to be in vain, that something must be done in respect of safety protocols for smaller building sites, so as to avoid any further deaths and injuries. Mrs Mackenzie, I absolutely endorse your sentiments about this, and express the firm view that if not implemented already, there ought be mandatory training for all employers and employees in the building industry in respect of safe unloading and placement of heavy items at building sites, amongst other things. 

29Mr Alan Mackenzie described the devastating impact that his son's death has had upon him.  He had to identify Nicholas after he died, and also endured the pain of carrying his son to his final resting place.  He said that time had not healed the immense grief that he continues to feel, made all the worse by milestone events such as birthdays and family gatherings. 

30He also spoke of his son's special gift of being able to relate to people of all ages, and his ability to light up a room with his infectious smile.  Mr Mackenzie said that he really misses the way that his son Nick would bounce into a room, and spoke of his fond memories of their weekly get-togethers for a counter meal.  He said that he has not had a decent night's sleep since his son's death.  He misses him greatly, but said that he will always have his son in his heart.

31Benjamin Patterson referred to his ‘brother’ as "Cracker", as his best friend, and said that his ‘brother's’ death had hit him very hard.  He said that he had changed profoundly as a person, and had distanced himself from other friends in the tight friendship group that he and Nicholas had previously enjoyed.  He said that he has been affected in his work as an electrician, and since his Nicholas’ death, he had become super cautious, which had slowed him down.  He has needed to seek counselling, as he had resorted to excessive drinking and aggression toward family and friends for no apparent reason.  He said that Nicholas was going to be an integral part of his future, as he had planned that he be a groomsmen at his wedding, and would have been a godparent of his children, as well as a best friend that he could always talk to.  He misses his ‘brother’ immeasurably, and has an overwhelming sadness that he believes he will never get over.  He said that he will always find it hard to live without his ‘brother’, and that Nicholas' death will always have an impact upon him.

32Kylie Mackenzie said that her brother, who she and her children referred to as "Uncle Nick", was a warm and charismatic and patient soul, who everyone adored.  She described the devastating impact that his death has had upon her, her son Mason, and the sadness she feels that her two younger children would never get to know their uncle.  She described her youngest brother as her biggest inspiration, as he had always set goals for himself, which he achieved through hard work and determination.  Ms Mackenzie said she feels the most overwhelming heartache when she thinks about the pain suffered by her parents, and most of all her brother Ben, who not only lost his little brother, but lost his best friend.  She said that words could not adequately express how Nick's death has affected her.  She said "You needed to know him, everyone needed to know him.  He was just that amazing."

33I take into account your plea of guilty, and that of the defendant company's, and the stage at which these pleas were ultimately entered.  Pleas of guilty were entered at the committal hearing stage, however these were subsequently withdrawn, and the matter was listed for trial in this court.  Your stance, and that of your company's, again changed in early June this year at a funding hearing.  Therefore, to an extent, you have facilitated justice, as you have ultimately saved the witnesses the time and trouble of giving evidence, and you have saved the community the time and expense of running a trial.

34However, the discount which you will receive will not be as great as it would have been had you pleaded guilty at the earliest opportunity.  I make it clear that you are not to be punished for your changes in stance.  You are entitled to plead not guilty.  However, your facilitation of justice would have been even greater if you had entered and maintained pleas of guilty from the outset. 

35The course that you have taken does not paint a clear picture of insightful remorse.  I accept that this tragedy has affected you deeply.  You had a great deal of affection for Nicholas.  Of course, it is not something you would ever want to have happened- that goes without saying.  I accept that you deeply regret what happened to Nicholas Mackenzie. However, I understand that you have struggled with the fact that others were not also charged, and you have had trouble in coming to grips with the legal situation in which you found yourself.  In the end, I find that you are remorseful, and you are developing some insight in respect of your and your company's offending, having ultimately accepted responsibility for it.

36Neither you nor the company have any antecedents, nor subsequent instances of offending, which are matters in your favour and in the company's favour.  I understand that you now take careful and proper steps in relation to static loads and load capacities of relevant structures at building sites in which you are involved.

37The character evidence tendered at the plea hearing reflects that you are a person of good character.  You have worked as a builder for a number of years, and have employed 11 apprentices over that time, hence contributing to the community in that way.  Currently, you employ your son as an apprentice.  He gave up his teacher training to assist you in your business after this tragedy occurred.  You employ two apprentices at present, including your eldest son.  Therefore, you and the company have made positive contributions to the community, as I have said.

38I understand that you have since joined the Housing Industry Association, which is a peak body in respect of building standards and business practices in the building industry.

39I factor in, as I must, that you sustained injuries in this tragic accident.  A report dated 3 October 2016, which was prepared by Mr Peter Thomas, physiotherapist, indicates that you sustained a right distal radius, a fractured left ulna, left head of radius, fractured ribs, and fractured left clavicle (scapula).  You underwent surgery on 23 August 2013 in a bid to attend to your injuries.  Amongst other things, this involved the replacement of the left radial head with a prosthesis.  You were discharged from physiotherapy treatment on
16 February 2015, having made a good deal of progress, although you have had some residual difficulties with shoulder pain and weakness in the left elbow. 

40The report says that you will have compromised wrist joints, left elbow and shoulder joint for life.  Mr Thomas said that you continue to make a remarkable recovery from your injuries, albeit that your long term upper limb capacity is compromised.

41Alyce Ward, clinical psychologist, said in her report dated 19 September 2016, that you are highly traumatised and grief-stricken by the accident in which you were involved, having witnessed the death of a young man who you regarded as part of your family. 

42Mr Cummins, psychologist, diagnosed you as suffering from adjustment disorder with mixed anxiety and depressed mood, such condition having arisen because of the trauma and grief experienced from the events of

22 August 2013.

43You have also been dealt with by the Building Practitioners Board, receiving a reprimand and fine of $5,000. 

44The matters to which I have referred are forms of extra-curial punishment, which have already been meted out to you, and I take these into account, as I must.

45I understand that you are most anxious about whether you will be able to obtain registration as a builder following the outcome of these proceedings, and whether you may be subjected to civil proceedings in the future.

46I take into account your background, some of which was set out by Mr Taylor at the plea hearing.  A detailed account is contained in the report of
Mr Cummins, psychologist, dated 17 July this year.  You are now 52 years old, and you are married with two children, who are now aged 19 and 21.  I was told that you moved to Australia from your birthplace, New Zealand, in 1995.  Your wife has suffered serious illness in recent times.  Your youngest child has been diagnosed as being on the borderline of having an Autism Spectrum Disorder.  He has some ongoing issues in respect of his mental health; he is unemployed and lives with you and your wife. 

47Mr Taylor set out details of your financial situation, indicating that you, like other small builders, did not run on large cash reserves, but relied on cash flow.  I was told that you were unable to work for seven months after the accident.  The company that was operating at the time is no longer running and about to go into liquidation, and as is so often the case; another company is up and running to continue on the business. Mr Taylor frankly told me that you did not want to have the company forced into liquidation as the result of an order of the court, but that it is no longer operating and is about to go into liquidation. 

48Your business is small scale; it is family owned and operated.  A letter provided to me from your account dated 30 August 2017 gives an estimate of your annual income as $87,880, and estimated annual expenses as being $63,461.  Your estimated cash position is $24,419. 

49I have had regard to your financial situation in imposing sentence, but it is not an all-controlling factor.  I understand that your new company has some building projects on its books.  Again, the work that is to be performed is on a subcontract basis.  In view of the salutary experience of this tragic accident, your lack of prior convictions or subsequent matters, and the steps you have taken to reduce risk in the workplace, I need only place minimal weight on specific deterrence.

50I was provided with some cases to assist me in respect of current sentencing practice, however, for the reasons submitted by counsel at the plea hearing, these cases have some material differences from the matters before me, which means that they are of very limited assistance, especially when it comes to the penalty to be imposed upon you, as opposed to the company.

51As I said at the plea hearing, no sum of money could ever bring Mr Mackenzie back, sadly-  And no fine is ever reflective of the invaluable life that has been lost.  This could never be the case, and is not what these offences are about.  I must impose penalties on the basis of the charges which have been brought, which are in respect of failing to provide and maintain a safe working environment, and  in your personal case, Mr Fergusson, by being an officer of the company, in failing to take reasonable care.

52In the end, I have arrived at penalties which, in my view, reflect the weight which I must give to all sentencing principles, bearing in mind in particular the strong weight which must attach to general deterrence. 

53Would you please stand up, Mr Fergusson?

54You and Jacbe Builders Pty Ltd are each convicted of the offences to which you have pleaded guilty.  The company is fined $700,000, and you are fined $180,000.  Could you please take a seat, and I will seek your counsel's advice as to a stay.

55MR TAYLOR:  Your Honour, I took some instructions from Mr Fergusson, and of course it is difficult to take it any further, until we know what Your Honour's final view is.  But I am asked to make an application for an instalment order.  And he instructs me that $2,000 a calendar month is obtainable.  Ordinarily I might seek an initial stay of three months, but we have got the figures now, and he certainly, as I am sure everyone else in the room, would like to bring all of the matters he can to a conclusion today.  I cannot ‑ ‑ ‑

56HER HONOUR:  All right, well I will see what the prosecution has to say as to that proposal.

57MR PALMER:  No objection to an instalment order, Your Honour.

58HER HONOUR:  All right then.  In light of the - or in view of the financial situation of your client, Mr Taylor, I will make that instalment order of $2,000 a month.  The first payment to be made - when do you propose the first payment to be made?

59MR TAYLOR:  Would Your Honour just allow me to speak - I am asked to ask Your Honour for an initial payment date of the end of October.  There have been, as I am sure Your Honour will understand, other pressing necessities on
Mr Fergusson, although less than might have otherwise been the case.

60HER HONOUR:  I will say that the first payment is to be made on or before
28 October 2017, and succeeding payments are to be made on or before the 28th of the month thereafter.

61MR TAYLOR:  As Your Honour pleases.  And there's finally one matter that I ‑ ‑ ‑

62HER HONOUR: I just wanted to give a s.6AAA indication if I could?

63MR TAYLOR:  Yes, of course.

64HER HONOUR:  I indicate that if not for the company's plea of guilty, I would have fined it $1m, and if not for Mr Fergusson's plea of guilty, I would have fined Mr Fergusson $230,000.  Yes, Mr Taylor?

65MR TAYLOR:  As Your Honour pleases.  Your Honour referred to Jacbe as in liquidation.  That might cause interest elsewhere, because of course it cannot be, because it is the subject of legal proceedings.  It had ceased trading, and will now go into liquidation.

66HER HONOUR:  I see, all right.  Well I will make amendments.  I understood from what you said it was actually - yes.

67MR TAYLOR:  No, no ‑ ‑ ‑

68HER HONOUR:  All right, ceased trading and will go into liquidation.

69MR TAYLOR:  It will go into liquidation now, I would imagine by the end of the week.

70HER HONOUR:  Yes, I see.  Yes.

71MR TAYLOR:  If Your Honour pleases.

72HER HONOUR:  All right, yes I am sorry.  I will amend those remarks to reflect that accurately.  All right, is there anything further?

73MR PALMER:  It is not a substantive one, but if Your Honour is amending, Benjamin Patterson is in fact - was in fact Mr Mackenzie's best friend, he his referring to this his brother as a metaphor.

74HER HONOUR:  I understand that.  I understand that ‑ ‑ ‑

75MR PALMER:  He has got an actual brother, Benjamin Mackenzie, which is why it can be slightly confusing that there are two Benjamins, so ‑ ‑ ‑

76HER HONOUR:  I see.

77MR PALMER:  There was just ‑ ‑ ‑

78HER HONOUR:  No, I understand that his best friend referred to him as his brother, and I was prepared to obviously recognise that, but he has also got a brother.

79MR PALMER:  He has an actual brother, Benjamin, as well.  Thank you Your Honour.

80HER HONOUR:  Yes, all right.  Thank you, is there anything further?

81MR PALMER:  No Your Honour.

82HER HONOUR:  All right, yes thank you, we will now adjourn.

Sentencing remarks were subsequently revised to reflect the discussions, above.

‑ ‑ ‑