DPP (Vic) v Mainline Developments Pty Ltd
[2020] VCC 47
•31 January 2020
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted Suitable for Publication |
AT MELBOURNE
CRIMINAL DIVISION
CR-19-00496
| DIRECTOR OF PUBLIC PROSECUTIONS |
| v |
| MAINLINE DEVELOPMENTS PTY LTD |
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JUDGE: | HIS HONOUR JUDGE DOYLE | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 11 December 2019 | |
DATE OF SENTENCE: | 31 January 2020 | |
CASE MAY BE CITED AS: | DPP v Vibropile Australia, DPP v Frewstal Pty Ltd, The Queen v Commercial Industrial Construction Group, DPP v Coates Hire Operations Pty Ltd, Holmes v Re Spence & Company Pty Ltd | |
MEDIUM NEUTRAL CITATION: | [2020] VCC 47 | |
REASONS FOR SENTENCE
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Catchwords: Occupational health and safety, failure of management to ensure the workplace is safe and without risk to health, failure to ensure no exposure to risks, failure to comply with Improvement Notice, guilty plea
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APPEARANCES: | Counsel | Solicitors |
| For the Crown | Ms A. Burt | Office of Public Prosecutions |
| For the Accused | Mr S. Russell | Stary Norton Halphen Pty Ltd |
HIS HONOUR:
1 Mainline Developments Pty Ltd has pleaded guilty to four charges under the Occupational Health and Safety Act. The offences in this case were committed between 15 January 2018 and 15 March 2018.
2 Charge 1, contrary to s26 of the Act, is an offence of failure of a person who has management and control to ensure the workplace is safe and without risk to health. The maximum penalty for this offence is 9000 penalty units. This equates to a maximum fine of $1,427,130.90
3 Charge 2, contrary to s23(1) of the Act, is an offence of failure to ensure persons other than employees were not exposed to risks. The maximum penalty is the same as for charge 1.
4 Charge 3 is a rolled-up charge of failing to provide a safe working environment contrary to s21 of the Act. The maximum penalty for this offence is the same as for charges 1 and 2.
5 Charge 4, contrary to s111(4) of the Act, is an offence of failing to comply with an Improvement Notice for which the maximum penalty is 2500 penalty units which equates to a fine of $396,425.
6 The facts of this matter are extensively set out in the particulars in the indictment as well as in the comprehensive prosecution opening tendered at the plea hearing and marked as Exhibit 1. I do not propose to repeat all that is covered in the particulars and in the prosecution opening but I will briefly summarise important facts in this matter.
7 Mainline Developments is a company that specialises in development of small and large scale construction projects. The offending in this case relates to a development at 52-62 Tinks Road where the company was constructing 28 double storey and three single storey townhouses. The site manager at this workplace was an employee of Mainline named Bill Cantonis.
Charge 1
8 On 15 January 2018, a WorkSafe inspector attended the workplace and observed employees undertaking work on the first floor of townhouses 19 to 23 with no controls in place to prevent the workers falling off the edge of the open balconies. An Improvement Notice was issued in relation to the risk of a fall from height. The workers were exposed to a risk of a fall for more than two metres which could have resulted in death or serious injury.
9 On 23 January 2018, WorkSafe inspectors again attended and on this date they saw that scaffolding had been erected across the edges of the balconies of townhouses 19 to 23 and therefore the Improvement Notice issued on 15 January had been complied with. However, inspectors observed a man undertaking painting duties on the first floor of townhouse 9 without fall protection. He was directed to get down from the roof.
10 Inspectors also observed inadequate timber railing and edge protection on some of the townhouses and that employees were at risk of falling approximately three metres from the first floor lower roof areas. A further WorkSafe Improvement Notice was issued in relation to fall protection.
11 On 1 February 2018, WorkSafe inspectors attended and they saw a man undertaking plumbing duties on the roof of townhouse 24 without fall protection. They also observed another man on the scaffolding at townhouse 21. The scaffolding was missing planks creating a risk of him falling through. This worker was directed to get down from the roof.
12 On 9 February, WorkSafe inspectors again attended in relation to the Improvement Notices that had not been complied with. Mr Cantonis was advised of the process and he was warned that failure to comply with the Notice was an offence.
13 On 1 March 2018, WorkSafe inspectors again attended and observed a person undertaking construction works from the lower front roof area of townhouse 14 without adequate fall protection in place. The live edge on the right side of the lower roof exposed the employee to a risk of falling over three metres.
14 On 5 April 2018, WorkSafe inspectors attended to follow up on the Improvement Notice and at that point all outstanding Improvement Notices had been complied with. It was reasonably practicable for the company to reduce the risk of injury at the workplace by erecting scaffolding across the live edges of the balconies and ensuring that the scaffolding had adequate railing and edge protection.
Charge 2
15 On 1 February 2018, a WorkSafe inspector saw that the means of entering and leaving the workplace was a high-volume single lane road with heavy traffic. The inspector further noticed a tip truck reversing into the workplace unassisted and another tray truck delivering roof sheets reversing into the workplace unassisted. Both trucks had to access the lane of oncoming traffic to enter the workplace, creating a risk of injury or death, from a collision between the truck and other road users.
Charge 3
16 This is a rolled-up charge covering the following failures by the company. Failure to provide safe work method statements for a range of high risk construction, failure to provide adequate facilities for the welfare of the employees of the workplace, failure to provide safe systems of work to reduce the risk of injury by electricity and failure to provide adequate housekeeping.
17 In relation to the failure to provide safe work method statements, works undertaken specified in Occupational Health and Safety Regulation 322 as high risk construction work, included: a risk of a person falling from more than two metres, work on or near energised electrical installations or services and work adjacent to roadways used by traffic and work involving movement of the powered mobile plant.
18 It was reasonably practicable for the company to reduce the risk of injury by providing a safe work method statement before work commenced in order to identify the risk and control measures to eliminate or reduce risk, ensure that the work was performed in accordance with such safe work method statements and review and revise the safe work method statements whenever there was an indication that the risk control measures were not adequate or where the high risk construction work changed.
19 In relation to facilities, there was no dining area and no clean drinking water provided for the employees. The toilets were observed to be unhygienic and unable to be flushed. There was hand washing unit and no weatherproof meal area such as a fridge to keep perishable food safe for consumption. In relation to electrical safety there was a risk of injury, serious injury or death resulting from electric shock to employees using electrical equipment which was not tagged or tested and did not have RCD protection.
20 The details of the company's failures in this regard are set out in paragraph 21 of the prosecution opening. In relation to housekeeping failures, these were observed on 15 January 2018 and 1 February 2018 by WorkSafe inspectors. These failures are described at paragraph 6(c) and paragraph 22 of the prosecution opening. There was a risk of slips, trips and falls causing serious injury to employees as a result of the untidy housekeeping at the workplace. It was reasonably practicable for the company to reduce the risk of injury by removing all excess materials from work and access areas, ensuring the ground floors were clear of rubbish and mud and were level and dry, implementing a system for regularly undertaking housekeeping tasks and ensuring that there were adequate bins and skips for rubbish disposal and ensuring that all employees and contractors and site visitors were aware of the housekeeping requirements.
Charge 4
21 The details of the failure to comply with Improvement Notices are set out in the Particulars in the indictment for charge 4. They include breaches of Notices in relation to fall protection, housekeeping, the provision of a safe system of work associated with the management of safe work method statements and the requirement to engage a suitably qualified person to provide advice concerning the health and safety of employees.
Sentencing principles
22 It is common ground between the parties that, for offences such as these, general deterrence is the predominant sentencing consideration. In the case of DPP v Vibro-pile Australia the Court of Appeal said:
'The seriousness with which breaches of s21 of the Occupational Health and Safety Act are to be treated is, as a sentencing judge observed, reflected in a maximum penalty of 9000 penalty units or $1,075,000.50 The sentencing judge also rightly observed that general deterrence is of particular importance in offending of this kind. The sentences imposed need to draw attention to the importance of workplace safety and to send a message to employers that failure to eliminate or mitigate safety risks will attract significant punishment.'[1]
[1] DPP v Vibro-Pile (Aust) Pty Ltd [2016] VSCA 55 para 223
23 In the case of DPP v Frewstal Pty Ltd[2], referred to in both the prosecution and the defence written submissions, the Court of Appeal set out the principles by which a sentencing judge should be guided which include the gravity of the breach rather than the result or consequences, the extent to which the defendant has departed from the statutory duty and the risk of death or serious injury which might result, the likelihood of the result of the breach endangering the safety of employees or others and the potential gravity of the consequence of such an event.
[2]DPP v Frewstal Pty Ltd (2015) 47 VR 660
The prosecution submissions
24 I turn to the prosecution submissions. The prosecution's written submissions on sentence address the factors set out in Frewstal. The prosecution submits that the breaches here were serious and a wide departure from the statutory duty. The risks involved were obviously well known and the breaches were not confined to one day. Notices that were issued were not complied with and the need for safe work method statements demonstrates that the risks were well known and that the company ought reasonably to have been aware of the risks and the ways to eliminate or reduce the risks. The measures required to reduce risks were not cost prohibitive
25 It is submitted by the prosecution that the company's breaches clearly have the potential to result in death or serious injury. It is further submitted that the occurrence of an incident was reasonably likely, particularly in relation to charge 1, due to a number of people observed working at a height where there was no fall protection or no system of work to reduce or eliminate the risk. Ms Burt submitted that the potential harm associated with the breaches was significant.
The defence submissions
26 I turn to the defence submissions. Mr Russell, on behalf of the company, relied on the following matters in mitigation: a guilty plea (which it was argued was entered at the earliest opportunity; and, in addition to the utilitarian value of the plea, was indicative of remorse and a willingness to facilitate the course of justice); that Mainline had existing safe systems of work in place and that it is less culpable to have a system which fails than to have no system at all; and that the company had entrusted the foreman of the site, Mr Cantonis, to ensure the safety of the work site and that he had failed to do so, including failing to make the company aware of the breach Notices. In his oral submissions Mr Russell relied on the decision of The Queen v Commercial Industrial Construction Group[3], otherwise known as (“CICG”), to argue that this last matter was a mitigating factor. Mr Russell also relied on the immediate remedial steps taken by the company management on becoming aware of the breaches including the steps taken to ensure there are no further breaches.
[3] (2006) 14 VR 321
27 Two issues arise from these submissions. The prosecutor, Ms Burt, argued in response that CICG does not stand for the proposition that it is mitigating where an employee responsible for safety fails to discharge their responsibility and further relied on the case of DPP v Coates Hire Operations Pty Ltd[4] ( “Coates Hire Operations”) in support of this argument.
[4][2012] VSCA 131
28 In CICG the site supervisor failed to ensure the safety of the workplace. The company argued on the plea that there was no more the company could have done. The Court of Appeal remarked that these submissions were fundamentally at odds with the admissions constituted by the plea of guilty that the company had failed to do everything reasonably practicable to ensure the safety of the workers and that there was a contradiction between accepting on the one hand that the supervisor was the company whilst submitting on the other hand that the company was less to blame because the supervisor had failed the company. The Court of Appeal said:
'When the employee in question is the person with supervisory responsibilities including responsibility for ensuring safety at the site, the gravity of the company's breach is increased, not reduced.’[5]
[5] CICG at [43]
29 The Court remarked that the company had an obligation of 'ongoing supervision and compliance' of the safe system of work and that employee’s compliance with the safe system must be constantly monitored. The Court noted the observations of Justice Harper in the decision of Holmes v Re Spence & Company Pty Ltd that:
'An employee's responsibility for the safety of its workers will not be discharged unless the employer takes an active, imaginative and flexible approach to potential dangers in the knowledge that human frailty is an ever present reality.’[6]
[6] Holmes v RE Spence & Co Pty Ltd (1992) 5 VIR 119, p112-113
30 In Coates Hire Operations, it was submitted on behalf of the defendant company that the fact that the company had been let down by the supervisor responsible for safety was a mitigating factor. This submission was said to derive support from the decision in CICG. The Court rejected this argument and agreed with the prosecution submission that the supervisor's senior management position was a reason that the analysis in CICG applied with even more force.
31 Mr Russell argues that because the supervisor in Coates Hire Operations was part of management, whereas Mr Cantonis was not, it is mitigating that it was Mr Cantonis who was responsible, that he failed the company. In my view neither CICG, nor Coates HireOperations provide support for this proposition. A similar argument was clearly rejected in CICG. The statement in Coates Hire Operations that the analysis in CICG applied with even more force because the supervisor was in management does not mean that the failures of a supervisor who is below management are transformed into a mitigating factor.
32 The second issue arising from Mr Russell's submissions is to what extent the safe systems of work were in place which were not adhered to rather than there being no safe systems in the first place. Mr Russell referred to the following passage of CICG where the Court said:
'How and why the failure occurred is however relevant to sentencing in assessing the company's culpability. It will be relevant know, for example, whether the breach was the result of a failure to adhere to systems put in place by management or alternatively was the result of a failure by management to establish adequate safety systems and procedures in the first place.’[7]
[7] CICG at [31]
33 Mr Russell argued that there were systems in place but Mr Cantonis failed to follow them. Mr Russell tendered two folders containing documents which record the company's efforts to deal with safety issues. It is clear from this material that Mainline has over the years engaged the following companies to assist with safety issues on their development projects: Be Safe International, O'Brien's Safety and more recently Action OHS.
34 O'Brien's Safety apparently provided training for supervisors, including a one-day training course, which was held in the middle of 2015. The company believed that Mr Cantonis attended this training day, however, there are no documents to establish that he did attend. As I understood the submissions these OHS companies also provided random audits of Mainline's workplaces and site safety inspection reports, but no such site safety inspection or audit was conducted on this development. Since the commission of these offences the company has engaged Action OHS to prevent a repetition of what happened at the Tinks Road development
35 I accept that in relation to this work site there was a traffic management plan in place which was not complied with on the day the WorkSafe inspector made his observations. It is less clear to me that there were otherwise safe systems of work established by the company in relation to this development.
36 It seems to me that the company simply trusted Mr Cantonis to establish a safe system of work based on his experience in the industry over many years. It also seems that there was some indication that all was not right on this work site because when Mr Henwood attended he noticed there were housekeeping issues in relation to the work site which he told Mr Cantonis to rectify. There was no follow up from this point on.
37 I am not of the view that Mainline was a company that disregarded safety issues generally. However, in my view in relation to this work site there were no specific safe systems of work in place other than the traffic management plan. Otherwise, it appears issues of safe work systems were simply entrusted to Mr Cantonis without any process of ensuring that he had established safe systems of work at this development.
38 During the course of his submissions Mr Russell conceded that these breaches without explanation would attract serious and significant penalties. Mr Russell characterised charge 3 as less serious and relating to housekeeping matters. In my view this charge is more serious than that, being a rolled-up charge and covering a range of matters including: the failure to provide safe work method statements, failures relating to electrical safety and failures to provide proper facilities occurring over a two-month period.
Comparative cases
39 I was provided with summaries of two matters which were dealt with summarily: Kamata Homes and Nathaniel Developments. Both cases had some common features with this matter but as always there are some differences. I have had regard to those cases.
Gravity of the breaches
40 I agree with the prosecution submission that the breaches in this case were a wide departure from the statutory duty. Serious aspects of the offending include that the breaches were not confined to one day and took place over two months. Workers were therefore exposed to an ongoing risk.
41 I accept that the fact safe work method statements were required for some of the work indicates that there were known risks exposed to employees which ought to have been controlled. I accept that the breaches in this case, particularly the breaches in relation to fall protection, had the potential to result in serious injury or death and the occurrence of such an incident was reasonably likely.
42 I accept that a serious aspect of this offending is that Mainline was put on notice of its duties by WorkSafe inspectors. I am also of the view that apart from the traffic management plan no other safety systems were in place at this work site and all responsibility for safety was handed over to Mr Cantonis. In my view the company failed to adopt an,
‘active, imaginative and flexible approach to dangers in the workplace or recognise human frailty as an ever present reality’[8].
[8]Holmes v RE Spence & Co Pty Ltd (1992) 5 VIR 119, p112-113
43 Indeed, some of the steps subsequently taken by the company in conjunction with Action OHS, to which I was taken by Mr Russell, are the sorts of things that should have been in place at the time of the development and which would likely have prevented these breaches.
Guilty plea
44 In relation to the plea of guilty I accept that this plea was entered at the earliest opportunity notwithstanding that there was a contested committal in this matter. I have been told there was an indication by the defence at the committal that the company would ultimately plead guilty once the appropriate charges were settled which took place post committal. The prosecution takes no particular issue with this submission. In my view the utilitarian value of the plea is significant and I accept it is indicative of remorse and a willingness to facilitate the course of justice.
Prior convictions
45 I have had regard to the fact that the defendant company has prior convictions and therefore the company was on notice in relation to safety risks. The prior convictions are, of course, relevant to considerations of specific deterrence. However, I am satisfied that the remedial actions taken by the company management as soon as the Improvement Notices were brought to their attention, including terminating the services of Mr Cantonis, were an immediate and commensurate response to the issues at the work site.
46 I accept that the engagement of Action OHS also reduces the likelihood of further breaches. In those circumstances the need for specific deterrence is reduced but not eliminated.
Financial circumstances
47 In relation to the company's financial circumstances I was simply told that in light of the company's ongoing work any fine I impose will be met by the company.
Sentencing
43 In sentencing in this matter I have had regard to the principle of totality and the need to avoid double punishment in circumstances where there is some overlap between the charges in terms of the aggravating features of the overall conduct. I have moderated the fines to be imposed in accordance with the application of these principles. The fines that I impose are as follows:
44 Charge 1, the company is convicted and the fined the sum of $50,000. On Charge 2, convicted and fined $10,000. On Charge 3, convicted and fined $40,000 and on Charge 4, convicted and fined $25,000.
HIS HONOUR: That should make a total of $125,000, is that right?
MR RUSSELL: Yes.
HIS HONOUR: Pursuant to s.6AAA, but for the plea of guilty I would have imposed fines totally $175,000.
MS BURT: Nothing more from me, Your Honour.
MR RUSSELL: The only thing I should indicate, Your Honour, you've indicated it was a contested committal.
HIS HONOUR: I thought it was.
MR RUSSELL: No, it wasn't.
HIS HONOUR: I beg your pardon, I thought it was.
MR RUSSELL: No, that's fine. What happened was there was an application for summary jurisdiction which was opposed and rejected and then it was a plea of not guilty entered at that stage but with a view that it was going to settle.
HIS HONOUR: In the end I have accepted the guilty plea was at the earliest opportunity so it had no significance to the sentencing.
MR RUSSELL: No, that's fine. Thank you, Your Honour.
HIS HONOUR: All right, thank you. We'll adjourn until 10.30.
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