Resource Recovery Solutions Pty Ltd v Ayton
[2021] WASC 443
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CRIMINAL
CITATION: RESOURCE RECOVERY SOLUTIONS PTY LTD ‑v- AYTON [2021] WASC 443
CORAM: SMITH J
HEARD: 26 JULY 2021
DELIVERED : 10 DECEMBER 2021
PUBLISHED : 10 DECEMBER 2021
FILE NO/S: SJA 1093 of 2020
BETWEEN: RESOURCE RECOVERY SOLUTIONS PTY LTD
Appellant
AND
LEONA YVONNE AYTON
Respondent
ON APPEAL FROM:
Jurisdiction : MAGISTRATES COURT OF WESTERN AUSTRALIA
Coram: MAGISTRATE L DIAS
File Number : PE 39876 of 2018, PE 39877 of 2018 & PE 39837 of 2018
Catchwords:
Criminal law - Appeal against conviction - Failure to maintain safe working environment of a worker who was a client of a labour hire agent, in circumstances of gross negligence
Statutory construction - Meaning of 'agent' in s 23F(1) of Occupational Safety and Health Act
Construction of contracts - Characteristic features of a labour hire arrangement considered - Principles that apply to infer the extension of an existing contract
Criminal law - Elements of gross negligence under s 18A(2) of Occupational Safety and Health Act considered - Meaning of 'contravention' in s 18A - Requirements of actual knowledge
Criminal procedure - Function, purpose and effect of particulars - Whether gross negligence could be found turned on the particulars - Prosecution bound by the case it particularised, as knowledge of the contravention measures found proven by the presiding magistrate
Criminal law - Appeal against conviction - Failure to comply with an improvement notice - Failure to state reasonable grounds for forming the opinion that a person is contravening a provision of the Occupational Safety and Health Act
Statutory interpretation - Formation of requisite opinion essential pre-condition to the exercise of power to issue an improvement notice - Statement of reasonable grounds of requisite opinion a jurisdictional fact - Requirement to 'specify' in s 48(2) of the Occupational Safety and Health Act different to the requirement to 'state' in s 48(2) - Substantial compliance with the requirement to state reasonable grounds is not sufficient for an improvement notice to be valid
Legislation:
Criminal Appeals Act 2004 (WA), s 9(1), s 9(2)
Magistrates Court Act 2004 (WA), s 31(1)
Occupational Safety and Health Act 1984 (WA), s 18A, s 19(1), s 19(2), s 23F, s 48(1), s 48(2), s 48(4), s 54
Result:
Leave to appeal on Grounds 1, 2, 3, 5 and 6 refused
Leave to appeal on Ground 7 and 8 allowed
Appeal on Ground 4 dismissed
Appeal allowed on Grounds 7, 8 and 9
Conviction of offence of gross negligence pursuant to s 18A of Occupational Safety and Health Act set aside, and conviction on general duty charge pursuant to s 19A(2) of Occupational Safety Act and Health Act substituted
Conviction of failing to comply with Improvement Notice set aside and verdict of not guilty substituted
Category: B
Representation:
Counsel:
| Appellant | : | S Vandongen SC & T Russell |
| Respondent | : | N John & G Stockton |
Solicitors:
| Appellant | : | Barry Nilsson Lawyers (WA) |
| Respondent | : | State Solicitor's Office |
Cases referred to in decision:
A v Doubikin [2019] WASC 426
Australian Crime Commission v Marrapodi [2012] WASCA 103; (2012) 42 WAR 351
Black Box Control Pty Ltd v TerraVision Pty Ltd [2016] WASCA 219
Boral Gas (NSW) Pty Ltd v Magill (1995) 37 NSWLR 150
Bunnings Forest Products Pty Ltd v Shepherd (Unreported, WASC, Library No 980235A, 5 May 1998)
Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253
Chugg v Pacific Dunlop Ltd [1990] HCA 41; (1990) 170 CLR 249
Cotter v The State of Western Australia [2011] WASCA 202
De Pledge v The State of Western Australia [2021] WASCA 1
De Romanis v Sibraa [1977] 2 NSWLR 264
Director of Public Prosecutions (Nauru) v Fowler [1984] HCA 48; (1984) 154 CLR 627
DTR Nominees Pty Ltd v Mona Homes Pty Ltd [1978] HCA 12; (1978) 138 CLR 423
Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd [2017] HCA 12; (2017) 261 CLR 544
Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523
Environment Protection Authority v Sydney Water Corporation Ltd (1997) 98 A Crim R 481
Forrest & Forrest Pty Ltd v Wilson [2017] HCA 30; (2017) 262 CLR 510
George v Rockett [1990] HCA 26; (1990) 170 CLR 104
Gibson v The State of Western Australia [2017] WASCA 141; (2017) 51 WAR 99
He Kaw Teh v The Queen [1985] HCA 43; (1985) 157 CLR 523
Interstruct Pty Ltd v Wakelam (1990) 3 WAR 100
John L Pty Ltd v Attorney-General (NSW) (1987) 163 CLR 508
Johnson v American Home Assurance Co [1998] HCA 14; (1998) 192 CLR 266
Johnson v Miller [1937] HCA 77; (1937) 59 CLR 467
Kirk v Industrial Court (NSW) (2010) 239 CLR 531
Laing O'Rourke (BMC) Pty Ltd v Kirwan [2011] WASCA 117
Legal & General Insurance Australia Ltd v Eather (1986) 6 NSWLR 390
LTC v The State of Western Australia [2021] WASCA 60
MEN v The State of Western Australia [2020] WASCA 118
Morgan v Cramer [2019] WASC 68
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) 256 CLR 104
Neach v Hobbs [2021] WASC 135
Ninyette v Holmes [2015] WASC 287
Nuhana v The State of Western Australia [2018] WASCA 79
Pereira v Director of Public Prosecutions [1988] HCA 57; (1988) 63 ALJR 1
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355
R v Anderson (1991) 53 A Crim R 421
R v Connell; Ex parte Helton Bellbird Collieries Ltd [1944] HCA 42; (1944) 69 CLR 407
R v Taufahema [2007] HCA 11; (2007) 228 CLR 232
Re Lawrence; Ex parte Goldbar Holdings Pty Ltd (1994) 11 WAR 549
Richardson & Wrench (Holdings) Pty Ltd v Ligon No 174 Pty Ltd [1994] FCA 488; (1994) 123 ALR 681
Rye v The State of Western Australia [2021] WASCA 43
Samuels v The State of Western Australia [2005] WASCA 193; (2005) 30 WAR 473
Selby v Pennings (1998) 19 WAR 520
Shoalhaven City Council v State Pollution Control Commission (1991) 52 A Crim R 291
Skelly v The State of Western Australia [2020] WASCA 3
Strahan v Brennan [2014] WASC 190
The State of Western Australia v R [2007] WASCA 42
The State of Western Australia v 'R' [2007] WASCA 42
Tobiassen v Reilly [2009] WASCA 26; (2009) 178 IR 213
Todd v Alterra at Lloyd's Ltd [2016] FCAFC 15; (2016) 239 FCR 12
Tokio Marine & Nichido Fire Insurance Co Ltd v Holgersson [2019] WASCA 114
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165
Toyota Motor Corp Australia Ltd v Ken Morgan Motors Pty Ltd [1994] 2 VR 106
Tsang v Francis [2021] WASCA 131
Vantage Holdings Group Pty Ltd v Donnelly [No 4] [2019] WASC 398
Watson v Vos [2019] WASC 327
Westpac Banking Corporation v Bell Group Ltd (in liq) [No 3] [2012] WASCA 157; (2012) 44 WAR 1
Workpac Pty Ltd v Rossato [2021] HCA 23; (2021) 392 ALR 39
Wylie v South Metropolitan College of TAFE [2003] WASCA 34
Young Investment Group Pty Ltd v QBE Insurance (Australia) Ltd [2019] WASC 74
Table of Contents
1.0 The appeal and the result
1.1 The offences
1.2 The grounds of appeal
1.3 General principles on appeal
1.4 Construction of statutes
2.0 The circumstances of the accident on 28 January 2016
3.0 Grounds 1 to 3
3.1 The findings of fact and law made in respect of the finding made in the first instance that, on 28 January 2016, Mr Rathinasabapathy carried out work under a labour hire arrangement between the appellant and Mode 2, and under an agreement made between Mr Rathinasabapathy and Mode 2
3.1.1 Findings as to the elements of s 23F of the OSH Act
3.1.2 Findings as to the business of Mode 2
3.1.3 Findings as to the nature of the engagement of Mr Rathinasabapathy to carry out work at the workplace
3.1.4 Findings as to the agreement between the appellant and Mode 2 to provide services to the appellant
3.2 General principles - Construction of contracts
3.3 Ground 1 - The agreement between Mode 2 and the appellant
3.3.1 The appellant's submissions
3.3.2 Ground 1 - Disposition - Was it not reasonably open on the whole of the evidence for the presiding magistrate to find beyond reasonable doubt that the labour hire arrangement existed between the appellant and Mode 2?
3.4 Ground 2 - Was there an agreement between Mr Rathinasabapathy and Mode 2 that applied to the carrying out of the work by Mr Rathinasabapathy for the appellant on the date of the accident?
3.4.1 The appellant's submissions - Ground 2
3.4.2 Principles - Circumstances where an agreement may be inferred
3.4.3 Ground 2 - Was it not reasonably open on the whole of the evidence of the court to find beyond reasonable doubt that an agreement between Mr Rathinasabapathy and Mode 2 applied to the carrying out of work by Mr Rathinasabapathy for the appellant?
3.5 Ground 3 - Was Mode 2 was an agent for the purposes of s 23F(1)?
3.5.1 Section 23F(1) - the meaning of agent
3.5.2 The appellant's submissions, the evidence and disposition of Ground 3
4.0 Grounds 4 to 8 - Gross negligence
4.1 Elements of the offence of gross negligence
4.2 The presiding magistrate's findings
4.3 The submissions made at first instance about the elements of gross negligence
4.4 Ground 6, Ground 7 and Ground 8
4.4.1 The appellant's submissions relevant to each of Grounds 6, 7 and 8
4.4.2 Actual knowledge and disregard
4.5 Grounds 4 and 5 - Did the presiding magistrate err in law in misstating and not applying the test for inferring actual knowledge?
4.5.1 The appellant's submissions - Ground 4 and Ground 5
4.5.2 Is error established?
5.0 Ground 9 -Whether Improvement Notice 6150097 was valid
5.1 The appellant's and the respondent's submissions
5.2 Disposition - Ground 9 - Improvement Notice IN 61500197 is invalid
6.0 Disposition of the appeal, the convictions and the orders that should be made
SMITH J:
1.0 The appeal and the result
1.1 The offences
The appellant was charged with three offences. The first and second charge (Charge PE 39876/18 and Charge PE 39877/18) were in the alternative, and alleged circumstances of gross negligence. The alternative charges were as follows:[1]
On 28 January 2016 at 50 Clune Street, Bayswater
1/2Where under a labour hire arrangement work was carried out for remuneration by a worker, namely MANIKANDAN RATH NASABAPATHY for the accused who was a client of a labour hire agent, namely Mode 2 Group Pty Ltd, in the course of the accused's trade or business, in relation to matters over which the accused had the capacity to exercise control, the accused failed to, so far as practicable, provide a working environment in which MANIKANDAN RATH NASABAPATHY was not exposed to hazards, in circumstances of gross negligence, contrary to sections 19(1), 19A(1) and 18A when read with s 23F of the Occupational Safety and Health Act 1984. (39876/18)
2/2Where a worker namely MANIKANDAN RATH NASABAPATHY, for remuneration carried out work for the accused, in the course of the accused's trade or business, and where the accused had the power of direction and control in respect of the work in a similar manner to the power of an employer under a contract of employment, and where there was no control of employment between MANIKANDAN RATH NASABAPATHY and the accused, the accused failed to, so far as practicable, provide and maintain a working environment in which MANIKANDAN RATH NASABAPATHY was not exposed to hazards, in circumstances of gross negligence, contrary to sections 19(1), 19A(1) and 18A when read with s 23E of the Occupational Safety and Health Act 1984. (39877/18)
[1] Unreported reasons of presiding magistrate delivered 10 July 2020, Attachment 'A' - Charges.
If the presiding magistrate found the appellant guilty of the first charge of gross negligence (PE 39876/18), it was not necessary to consider the second alternative charge of gross negligence (PE 39877/18).
The third charge (PE 39837/18) was as follows:[2]
Between 1 August 2015 - 28 January 2016 at 50 Clune Street, Bayswater, the Accused, being a person to whom improvement notice no. 61500197 was issued by an inspector duly appointed under the Occupational Safety and Health Act 1984, failed to comply with the improvement notice within the time specified therein, contrary to sections 48(4) and 54 of the Act.
[2] Unreported reasons of presiding magistrate delivered 10 July 2020, Attachment 'A' - Charges.
Following a 10 day trial on and between 2 December 2019 and 4 February 2020, on 10 July 2020, the appellant was found guilty of breaching s 19(1) of the Occupational Safety and Health Act 1984 (WA) (OSH Act) (Charge PE 39876/18) in circumstances of gross negligence, where a labour hire arrangement applied, pursuant to s 23F of the OSH Act), and guilty of Charge PE 39837/18 (failing to comply with an improvement notice within the time specified therein, contrary to s 48(4) and s 54 of the OSH Act).
The appellant was fined $310,000 on Charge PE 39876/18, and $20,000 on Charge PE 39837/18, and ordered to pay costs of $234,000.
1.2 The grounds of appeal
The appellant's grounds of appeal are as follows:
Ground 1
1.A miscarriage of justice was occasioned because it was not reasonably open on the whole of the evidence for the Court to find beyond reasonable doubt that a labour hire arrangement existed between the Appellant (RRS) and Mode 2 Group Ltd (Mode 2) for the purposes of s 23F of the Occupational Safety and Health Act 1984 (the Act).
Particulars
(a)On the proper construction of Exhibit 34 (Agreement), it was not open to find that Mode 2 had agreed with RRS to provide a worker (Manikandan Rathinasabapthy) to carry out work for RRS for the purposes of s 23F(3)(a) of the Act (Reasons at [44](b), [48] to [65]).
(b)To the extent that the Court relied on the principles in Codelfa Construction Pty Ltd v State Rail Authority of New South Wales [1982] HCA 24; (1982) 149 CLR 337 in using extrinsic evidence to construe the Agreement that was erroneous (Reasons at [62] to [64]).
(c)To the extent that the Court relied on post-contract conduct to construe the Agreement that was erroneous (Reasons at [65]).
Ground 2
2.A miscarriage of justice was occasioned because it was not reasonably open on the whole of the evidence for the Court to find beyond reasonable doubt that an agreement between Manikandan Rathinasabapthy and Mode 2 applied to the carrying out of work by Mr Rathinasabapthy for RRS for the purposes of s 23F(3)(d) of the Act (Reasons at [40]).
Ground 3
3.A miscarriage of justice was occasioned because it was not reasonably open on the whole of the evidence for the Court to find beyond reasonable doubt that Mode 2 was an agent for the purposes of s 23F(1) of the Act (Reasons at [44(a)], [46], [47]).
Ground 4
4.The Court erred in law by misstating the legal test in considering inferential evidence to prove actual knowledge for the purposes of s 18A(2)(a)(i) of the Act, in particular the Court did not state that an inference of actual knowledge must be the only rational inference available (Reasons at [185] to [189]).
Ground 5
5.The Court erred in law in finding that RRS had the necessary actual knowledge for the purposes of s 18A(2)(a)(i) of the Act, in circumstances in which it had made no finding that the only rational inference was that RRS had that knowledge (Reasons at [197] and [198]).
Ground 6
6.The Court erred in law by finding that it could aggregate the knowledge of Mr Mangione, Mr Di Cicco and Mr Clarke and attribute that knowledge to RRS for the purposes of s 18A(2)(a)(i) of the Act (Reasons at [190] to [196].
Ground 7
7.A miscarriage of justice was occasioned because it was not reasonably open on the whole of the evidence for the Court to find beyond reasonable doubt that RRS had actual knowledge that a contravention by failing to implement the practicable measures in particulars 5(c) to (e) was likely to cause death or serious harm for the purposes of s 18A(2)(a)(i) of the Act (Reasons at [197] to [199]).
Ground 8
8.A miscarriage of justice was occasioned because it was not reasonably open on the whole of the evidence for the Court to find beyond reasonable doubt that RRS had acted or failed to act in disregard of the likelihood in respect of the contravention comprising a breach of particulars 5(c) to (e) for the purposes of s 18A(2)(a)(i) of the Act (Reasons at [207] to [211]).
Ground 9
9.The Court erred in law in finding that Improvement Notice 6150097 was valid (Reasons at [229] to [249]).
1.3 General principles on appeal
On 4 December 2020, Archer J granted leave to appeal on grounds 4 and 9.
Leave to appeal is required for each ground of appeal. The court must not grant leave to appeal on a ground of appeal unless it is satisfied that the ground has a reasonable prospect of succeeding. This means that the ground is required to have a rational and logical prospect of succeeding, in that it would not be irrational, fanciful or absurd to envisage it succeeding, or in effect that it has a real prospect of success.[3]
[3] Samuels v The State of Western Australia [2005] WASCA 193; (2005) 30 WAR 473 [56]; Criminal Appeals Act 2004 (WA), s 9(1) and (2).
The appellant's grounds of appeal raise issues as to whether a miscarriage of justice has been occasioned, and errors of law, but do not raise any issue going to an error in the facts found by the presiding magistrate.
In grounds 1, 2, 3, 7 and 8 (which relate to the charge of gross negligence only), the appellant raises arguments that a miscarriage of justice was occasioned in respect of particular findings which are claimed to have not reasonably been open on the evidence.
The Chief Justice and Beech JA, in a joint judgment in MEN v The State of Western Australia, recently summarised the general principles governing the determination of appeals alleging that a jury's verdict is unreasonable or cannot be supported.[4] Although this is an appeal against a decision made by a magistrate, these principles are nonetheless applicable. In MEN v The State of Western Australia, Quinlan CJ and Beech JA said:[5]
[4] MEN v The State of Western Australia [2020] WASCA 118.
[5] MEN v The State of Western Australia [2020] WASCA 118 [403] ‑ [406] (footnotes omitted); applied in De Pledge v The State of Western Australia [2021] WASCA 1 [29]; LTC v The State of Western Australia [2021] WASCA 60 [71].
In Wells v The State of Western Australia, this court summarised the principles governing a ground of appeal that the verdict is unreasonable or cannot be supported by the evidence, by reference to the leading authorities, including M v The Queen, SKA v The Queen and R v Baden‑Clay, as follows:
(a)The appeal court must undertake its own independent assessment of the sufficiency and quality of the evidence. It is not simply a matter of deciding whether as a matter of law there was evidence to support the verdict. The appeal court must determine whether, in all the circumstances, it would be dangerous to permit the verdict to stand.
(b)The question for the appeal court is whether, upon the whole of the evidence, it was open to the jury to be satisfied beyond reasonable doubt that the accused was guilty.
(c)That question requires consideration of whether the jury must, as distinct from might, have entertained a reasonable doubt about the accused's guilt.
(d)In answering that question, the appeal court must pay full regard to the consideration that the jury was entrusted with the primary responsibility of determining guilt or innocence, and to the advantage that the jury had of seeing and hearing the witnesses.
(e)A doubt experienced by an appellate court would be a doubt which a jury ought also to have experienced, unless the jury's advantage in seeing and hearing the evidence is capable of resolving that doubt.
(f)If the evidence, upon the record, contains discrepancies, displays inadequacies, is tainted or otherwise lacks probative force in such a way as to lead the appellate court to conclude that, even making full allowance for the advantages enjoyed by the jury, there is a significant possibility that an innocent person has been convicted, then the appellate court must set aside the verdict.
(g)The setting aside of a jury's verdict on the ground that it is unreasonable within the meaning of s 30(3)(a) of the Criminal Appeals Act is a serious step, not to be taken without regard to the advantage enjoyed by the jury over a Court of Appeal which has not seen or heard the witnesses called at trial.
In Fennell v The Queen, the High Court observed:
Where a court of criminal appeal is called upon to decide whether it considers that, upon the whole of the evidence, it was open to the jury to be satisfied beyond reasonable doubt that the accused was guilty of the offence charged, the court must not disregard or discount either that the jury is the body entrusted with primary responsibility of determining whether the prosecution has established the accused's guilt or that the jury has had the benefit of having seen and heard the witnesses. At the same time, however, the court may take into account the realities of human experience, including the fallibility and plasticity of memory especially as time passes, the possibility of contamination of recollection, and the influence of internal biases on memory. The court can also take into account the well-known scientific research that has revealed the difficulties and inaccuracies involved in assessing credibility and reliability. (citations omitted)
Recently, in Pell v The Queen, the High Court elaborated on the principles in the following terms:
[T]he assessment of the credibility of a witness by the jury on the basis of what it has seen and heard of a witness in the context of the trial is within the province of the jury as representative of the community. Just as the performance by a court of criminal appeal of its functions does not involve the substitution of trial by an appeal court for trial by a jury, so, generally speaking, the appeal court should not seek to duplicate the function of the jury in its assessment of the credibility of the witnesses where that assessment is dependent upon the evaluation of the witnesses in the witness-box. The jury performs its function on the basis that its decisions are made unanimously, and after the benefit of sharing the jurors' subjective assessments of the witnesses. Judges of courts of criminal appeal do not perform the same function in the same way as the jury, or with the same advantages that the jury brings to the discharge of its function.
It should be understood that when the joint reasons in M v The Queen spoke of the jury's 'advantage in seeing and hearing the witnesses' as being 'capable of resolving a doubt experienced by a court of criminal appeal' as to the guilt of the accused, their Honours were not implying that it was only because there were, at that time, no practical means of enabling a court of criminal appeal to see and hear the evidence of the witnesses at trial that the jury's assessment of the credibility of the witnesses was of such potentially critical importance. The assessment of the weight to be accorded to a witness' evidence by reference to the manner in which it was given by the witness has always been, and remains, the province of the jury. Rather, their Honours in M were remarking upon the functional or 'constitutional' demarcation between the province of the jury and the province of the appellate court. That demarcation has not been superseded by the improvements in technology that have made the video-recording of witnesses possible.
The function of the court of criminal appeal in determining a ground that contends that the verdict of the jury is unreasonable or cannot be supported having regard to the evidence, in a case such as the present, proceeds upon the assumption that the evidence of the complainant was assessed by the jury to be credible and reliable. The court examines the record to see whether, notwithstanding that assessment - either by reason of inconsistencies, discrepancies, or other inadequacy; or in light of other evidence - the court is satisfied that the jury, acting rationally, ought nonetheless to have entertained a reasonable doubt as to proof of guilt. (citations omitted; emphasis added)
In this passage, the High Court emphasised that the assessment of the weight to be accorded to a witness' evidence by reference to the manner in which it was given by the witness is, and remains, the province of the jury, and not of the appellate court. The appellate court performs its function on the assumption, in a case such as the present case, that the evidence of the complainant was assessed by the jury to be credible and reliable. The question for the appellate court is whether, upon its examination of the record, by reason of inconsistencies, discrepancies or other inadequacy, or in light of other evidence, the court is satisfied that the jury, acting rationally, ought nonetheless to have entertained a reasonable doubt as to guilt.
Even if a ground of appeal might be decided in favour of the appellant, the court may dismiss the appeal if it considers that no substantial miscarriage of justice has occurred.
Success on any ground will not necessarily result in the setting aside of the conviction and the substitution of a verdict of acquittal, if the court considers that no substantial miscarriage of justice has occurred, because not all errors of law enliven this court's jurisdiction. To enliven the appellate court's jurisdiction, the error must be material, in the sense that it must have affected, or have been capable of affecting, the decision to convict or acquit. In Morgan v Cramer, Hall J explained:[6]
The success of the grounds of appeal does not necessarily result in the setting aside of the acquittal and the substitution of a conviction. Section 14(2) of the Criminal Appeals Act 2004 (WA) provides that even if a ground of appeal might be decided in favour of the appellant, the court may dismiss the appeal if it considers that no substantial miscarriage of justice has occurred.
This form of the proviso needs to be understood as operating in a context where, unlike a jury, the magistrate provides detailed reasons for his or her decision. This enables an assessment to be made of whether any error was in fact material to the result, rather than merely having the potential to have such an effect.
Whether the error is one of fact or law is relevant to the question of whether there has been no substantial miscarriage of justice. Where the error is one of law, there may be circumstances where the error has not affected the outcome, but there has been such a significant breach of the presuppositions of a trial that the operation of the proviso is excluded.
[6] Morgan v Cramer [2019] WASC 68 [44] ‑ [46] (footnotes omitted).
Generally, an immaterial or inconsequential error will not give rise to a substantial miscarriage of justice. Where an error could not have affected the outcome, an appeal court will generally be able to conclude that there has been no substantial miscarriage of justice.[7]
[7] Ninyette v Holmes [2015] WASC 287 [65].
When considering a magistrate's reasons, as Archer J recently observed:[8]
[I]t is necessary to keep in mind the nature of the work of magistrates. As was pointed out by Martin CJ in Strahan v Brennan, magistrates are required to conduct cases efficiently and with a degree of informality given the large volume of cases they hear each day. Accordingly:
[I]t is not appropriate to scrutinise the reasons for decision given by magistrates with a fine‑tooth comb or with an eye keenly attuned to the identification of error. Nor is it appropriate for the court to infer from infelicity of language that error is thereby demonstrated. That is because, of necessity, magistrates are required to perform their important functions in a different time frame to that which applies in the superior courts and in that context it is to be expected that some infelicity of language is likely to occur from time to time.
[8] Neach v Hobbs [2021] WASC 135 [15] (Archer J) (footnotes omitted), citing Strahan v Brennan [2014] WASC 190 [89] - [90] (Martin CJ); see Magistrates Court Act 2004 (WA), s 31(1).
These observations may have less weight when, as here, a magistrate has reserved their decision after a hearing and delivered it at a later date. Nevertheless, a magistrate in such a case must still manage a large volume of cases daily and is still faced with the requirement to conduct cases efficiently and with a degree of informality. It remains inappropriate to scrutinise their reasons with a fine-tooth comb and it is still to be expected that some infelicity of language is likely to occur from time to time, even with reserved decisions.
1.4 Construction of statutes
A number of the grounds of appeal raise the proper construction of a number of provisions of the OSH Act.
The principles that apply to the construction of statutory provisions, in particular to the construction of express object and purpose provisions in a statute and statutory provisions creating offences, were recently summarised by the Court of Appeal in Tsang v Francis as follows:[9]
[9] Tsang v Francis [2021] WASCA 131 [138] - [148] (footnotes omitted).
The statutory text is the surest guide to Parliament's intention. A decision as to the meaning of the text requires consideration of the context, in its widest sense, including the general purpose and policy of the provision. See Project Blue Sky Inc v Australian Broadcasting Authority; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (NT); Travelex Ltd v Federal Commissioner of Taxation; SZTAL v Minister for Immigration and Border Protection.
The context includes the existing state of the law, the history of the legislative scheme and the mischief to which the statute is directed. See CIC Insurance Ltd v Bankstown Football Club Ltd.
However, legislative history and extrinsic materials cannot displace the meaning of statutory text. Further, the examination of legislative history and extrinsic materials is not an end in itself. See Federal Commissioner of Taxation v Consolidated Media Holdings Ltd; Alphapharm Pty Ltd v H Lundbeck A/S.
The purpose of legislation must be derived from the statutory text and not from any assumption about the desired or desirable reach or operation of the relevant provisions. See Certain Lloyd's Underwriters v Cross. The intended reach of a legislative provision is to be discerned from the words of the provision and not by making an a priori assumption about its purpose. See Minister for Employment and Workplace Relations (Cth) v Gribbles Radiology Pty Ltd.
A section in a statute which specifically states the purposes or objects of the statute is relevant to the proper construction of the statute. See Tickner v Bropho; Russo v Aiello. It is necessary to consider the method by which Parliament has implemented the specified purposes or objects. See Municipal Officers' Association of Australia v Lancaster. The purposes or objects must be read and understood in the context of the statute as a whole. See IW v The City of Perth.
By s 29 of the Interpretation Act 1984 (WA), every section of an Act takes effect as a substantive enactment without introductory words. This provision was included in the Interpretation Act to avoid the repetition of enacting words before each section. See Smalley v Motor Accident Authority of New South Wales. A section in a statute which specifically states the purposes or objects of the statute therefore, of itself, takes effect as a substantive enactment.
Section 18 of the Interpretation Act provides that, in the interpretation of a provision of a written law (including all Acts for the time being in force), a construction that would promote the purpose or object underlying the written law (whether that purpose or object is expressly stated in the written law or not) shall be preferred to a construction that would not promote that purpose or object. The requirement in s 18 that one construction be preferred to another can apply only where two constructions are otherwise open. If the ordinary meaning conveyed by the text of a provision is to be modified by reference to the purposes or objects underlying the written law, the modification must be able to be identified precisely as that which is necessary to give effect to those purposes or objects and it must be consistent with the text otherwise adopted by the draftsperson. Section 18 requires a court to construe a written law, and not rewrite it by reference to its purposes or objects. See Mills v Meeking.
The view has been expressed that a section in a statute which specifically states the purposes or objects of the statute cannot cut down the meaning of another provision of the statute if that meaning is, in its textual and contextual surroundings, plain and unambiguous. See, for example, Minister for Urban Affairs and Planning v Rosemount Estates Pty Ltd; S v Australian Crime Commission; Director of Public Prosecutions v Mattiuzzo. This view has been based primarily on similar observations in Wacando v Commonwealth in relation to the proper construction of a preamble to a statute.
More recently, in Lynn v The State of New South Wales, Beazley P stated that the object provisions of a statute cannot control clear statutory language. Her Honour then elaborated:
Further, there are many statutes where the objects of the Act are directed to disparate ends and are not necessarily harmonious. Nonetheless, as Gleeson CJ observed in Russo v Aiello (2003) 215 CLR 643; [2003] HCA 53 at [5], the statement of legislative objects is 'not an exercise in apologetics', rather, it gives practical content to terms such as 'reasonable', 'justification' and 'satisfactory'. Likewise, the long title of an Act may be referred to as an aid to construction of the provisions of the Act: Pitt, Son & Badgery Ltd v Municipal Council of Sydney (1908) 24 WN (NSW) 203 at 204; Birch v Allen (1942) 65 CLR 621.
In Beckwith v The Queen, Gibbs J made these observations in relation to the proper approach to the construction of penal provisions in a statute:
The rule formerly accepted, that statutes creating offences are to be strictly construed, has lost much of its importance in modern times. In determining the meaning of a penal statute the ordinary rules of construction must be applied, but if the language of the statute remains ambiguous or doubtful the ambiguity or doubt may be resolved in favour of the subject by refusing to extend the category of criminal offences: see R. v Adams (1935) 53 CLR 563, at pp. 567 - 568); Craies on Statute Law, 7th ed. (1971), pp. 529-534. The rule is perhaps one of last resort.
See also Deming No 456 Pty Ltd v Brisbane Unit Development Corporation Pty Ltd; Waugh v Kippen; Newcastle City Council v GIO General Ltd; Re Day (No 2); Aubrey v The Queen.
The existence of a penal provision in a statute is part of its context. See Alcan (NT) Alumina [57].
2.0 The circumstances of the accident on 28 January 2016
In written reasons for decision delivered on 10 July 2020, her Honour made the following findings of fact that are relevant to the disposition of the issues raised in the appeal.
The appellant operates a business of recycling material from construction and demolition sites, and operates from premises at 50 Clune Street, Bayswater, known as Instant Waste (the workplace).
A number of migrant workers who originated from Sri Lanka, with limited English, were employed at the workplace by another company, Mode 2 Group Pty Ltd (Mode 2) as sorters (also known as 'pickers') to carry out work, under the appellant's instruction and direction. The role of the sorters was to pick rubbish at picking stations and to clear blockages from conveyor belts.
During each of the two daily shifts, the conveyor belts throughout the workplace were subject to regular blockages, which the sorters were required to clear.
On 28 January 2016, one of the sorters, Mr Manikandan Rath Rathinasabapathy, was working in the picking station with other workers. One of the conveyor belts, known as the 'diversion belt' (Diversion Belt), was located in the crushing area, Area 5. During that day, the Diversion Belt experienced multiple blockages, and Mr Rathinasabapathy attended Area 5 with other workers to clear them.
The Diversion Belt was between a rock belt and a crusher belt. It diverted material to the crusher and then the material went through a screen to a stacker belt. Any material that did not go through the screen went through the Diversion Belt and the crusher again.
On the final occasion when Mr Rathinasabapathy attended Area 5 to clear a blockage, Mr Jerald Anthony (Jena), Thaventhiram Gopalasingam (Thavam), Mr Sutharshan Selliyah (Sudah) and Mr Raveendran Sridharan (Shah (also referred to as Sri)), the operator for Area 5, and Mr Sayedreza Mosawe (Reza), a machine operator, also attended.
Mr Rathinasabapathy and Jena were on either side of the Diversion Belt's roller to clear the blockage. Thavam was close to the roller near Jena. Reza stood at the Diversion Belt's nearby control panel, approximately 2 metres away, and operated the controls. The Diversion Belt was switched off to enable clearance. After it had been cleared and switched on for testing, it blocked again, at least once. After the belt was switched off to clear the last blockage, Reza turned the belt on again. When it was activated and moving, Jena reached in with his hand to remove a small stone from the top side of the gap between the top and bottom sections of the moving Diversion Belt. Mr Rathinasabapathy then put his hands into the bottom end of the roller, where the roller meets the Diversion Belt, to remove a rock or stone. In doing so, Mr Rathinasabapathy's right arm was dragged into the pinch point between the belt and roller of the Diversion Belt and was amputated at the shoulder (the accident). Reza pushed the emergency button to immediately stop the Diversion Belt. The Diversion Belt had to be cut to remove Mr Rathinasabapathy's arm.
At the time of the accident, there were two ways to access Area 5. The first access was from the walkway near the picking station and the second from an external access stairway below. There was a hinged gate to the crusher area, at the landing from the picking station (Area 5 Gate).
3.0 Grounds 1 to 3
Grounds 1 to 3 of the appeal raise three issues. The three issues are whether it was not reasonably open on the whole of the evidence for the presiding magistrate to find to the requisite standard, within the meaning of s 23F of the OSH Act that:
(a)a labour hire arrangement existed between the appellant and Mode 2 (Ground 1);
(b)an agreement between Mr Rathinasabapathy and Mode 2 applied to the carrying out of work by Mr Rathinasabapathy for the appellant (Ground 2); and
(c)Mode 2 was an agent carrying on a business of providing workers to carry out work for clients (Ground 3).
3.1 The findings of fact and law made in respect of the finding made in the first instance that, on 28 January 2016, Mr Rathinasabapathy carried out work under a labour hire arrangement between the appellant and Mode 2, and under an agreement made between Mr Rathinasabapathy and Mode 2
Section 23F of the OSH Act provides:
23F.Labour hire arrangements
(1)In this section -
agent -
(a)means a person that carries on a business of providing workers to carry out work for clients of the person; and
(b)includes a group training organisation as defined in section 7(1) of the Industrial Relations Act 1979;
worker includes an employee or a contractor.
(2)This section applies where, under a labour hire arrangement, work is carried out for remuneration by a worker for a client of an agent (the client) in the course of the client's trade or business.
(3)A labour hire arrangement exists where -
(a)an agent has for remuneration agreed with the client to provide a worker to carry out work for the client; and
(b)there is no contract of employment between the worker and the client in relation to the work; and
(c)there is an agreement (which may be a contract of employment) between the worker and the agent as to the carrying out of work including in respect of remuneration and other entitlements; and
(d)that agreement applies to the carrying out of the work by the worker for the client.
(4)Where this section applies, sections 19 and 19A have effect as if -
(a)each of the agent and the client were the employer of the worker; and
(b)the worker were an employee of each of the agent and the client,
in relation to any matter that -
(c)comes within section 19; and
(d)as regards -
(i)the agent, is a matter over which the agent has the capacity to exercise control; or
(ii)the client, is a matter over which the client has the capacity to exercise control.
(5)Where this section applies, the further duties referred to in subsection (6) apply, and sections 20A and 23J have effect, as if -
(a)each of the agent and the client were the employer of the worker; and
(b)the worker were an employee of each of the agent and the client.
(6)The further duties mentioned in subsection (5) are -
(a)the duties of an employee under section 20; and
(b)the duties of an employer under section 23I(3).
(7)This section applies despite anything to the contrary in, or any inconsistent provision of, an agreement, whether made orally or in writing.
(8)A purported waiver by a worker of a right that arises directly or indirectly under this section is void.
The presiding magistrate made the following findings of fact and law, set out in 3.1.1 to 3.1.4, which are relevant to Grounds 1 to 3.
3.1.1 Findings as to the elements of s 23F of the OSH Act
In order to establish charge 39876/18, the prosecution must prove beyond reasonable doubt that:
(a)Mode 2 was an 'agent', namely, that it 'carried on a business of providing workers to carry out work for [Mode 2's] clients' (s 23F(1)); and
(b)there was a labour hire arrangement between Mode 2 and RRS where:
(i)Mode 2 had for remuneration agreed with the appellant to provide a worker (Mr Rathinasabapathy), to carry out work for the appellant;
(ii)there was no contract of employment between Mr Rathinasabapathy and the appellant in relation to the work;
(iii)there was an agreement (which may be a contract of employment) between Mr Rathinasabapathy and Mode 2 as to the carrying out of work, including in respect of remuneration and other entitlements; and
(iv)that agreement applied to the carrying out of the work by Mr Rathinasabapathy for the appellant (s 23F(3)).
If each of the matters stated in [31] are established,[10] s 23F applies if where, under the labour hire arrangement, work was carried out for remuneration by a worker for a client of Mode 2, namely the appellant, in the course of the appellant's trade or business.[11]
3.1.2 Findings as to the business of Mode 2
[10] Unreported reasons for decision of presiding magistrate, delivered 10 July 2020, [30].
[11] Occupational Safety and Health Act 1984 (WA), s 23F(2).
The relevant evidence relating to the issue of whether Mode 2 was carrying on a business of providing workers to carry out work for its clients, included the following:
(a)Mr De Gee's (Mode 2's director) evidence that, 'we [Mode 2] provide engineering services to the waste recycling industry';[12]
(b)when the appellant was considering options of labour hire companies to obtain labour, Mr Salvatore Mangione (a director of the appellant) met with Mr De Gee to obtain that labour;
(c)the agreement was subsequently executed;
(d)Mode 2 recruited and entered into employment contracts with the workers, who then carried out work at the workplace at the appellant's direction;
(e)Mode 2 paid the workers directly; and
(f)Mode 2 invoiced, and was paid by, the appellant for 'labour supplied at Instant Waste'.
3.1.3 Findings as to the nature of the engagement of Mr Rathinasabapathy to carry out work at the workplace
[12] ts, 11 December 2019, 848.
Mr Rathinasabapathy was carrying out work for the appellant for remuneration, under a labour hire arrangement between Mode 2 and the appellant. For the purposes of s 23F of the OSH Act:
(a)it is not in dispute that the workers were employed by Mode 2 or that they performed work at the workplace, under the direction of the appellant;
(b)there was a contract of employment between each of the sorters, including Mr Rathinasabapathy, and Mode 2; and
(c)there was no contract of employment between the sorters and the appellant in relation to the work.
3.1.4 Findings as to the agreement between the appellant and Mode 2 to provide services to the appellant
An agreement titled, 'Draft Contractor Agreement Instant Waste C & I Bayswater Operations', dated 17 April 2015, was executed between the appellant and Mode 2, signed by Salvatore Mangione and Tom Mangione for the appellant, and by Theodore De Gee for Mode 2.[13] It is the only documented agreement between the appellant (described as the 'Company' in the agreement) and Mode 2 (described as the 'Contractor' in the agreement) in relation to the work that Mode 2 employees performed at the workplace.
[13] Exhibit 34.
The presiding magistrate found that it appeared that the agreement was a generic contractor agreement that had been modified, mainly in the schedules, to specify Mode 2's obligations. Her Honour then went on to find as follows in [37] to [50] of these reasons.
Mode 2's obligation was set out in cl 2 of the agreement as follows:
The Contractor will provide the Services to the Company at the Site for the Term on the terms and conditions set out in this Agreement. The Term may be extended by agreement between the parties. (Refer: Schedule 4 Job Description).
The term, 'Services' was defined in cl 1.1 (Definitions) as:
the services specified in Schedule 2 and any other services as reasonably requested from time to time by the Company.
Schedule 4 set out the job description for a 'Sorter', including the basic objective and responsibilities.
Schedule 2 stated as follows:
SERVICES
The Contractor must provide the following services:
(a)Staff training
(b)Site inductions
(c)Compliance with relevant Council contractual requirements
(d)Site daily housekeeping
(i)Personal Protective Equipment - Safety Glasses; Rubber Boots; Shirts; Hard Hats; Ear Plugs; Gloves
Acceptance of Material
The Company will agree a daily schedule with the Contractor to remove the majority of the tonnes processed by the plant on the basis of full loads only...
Clause 7 relevantly stated:
7.1The Contractor is engaged by the Company as an independent contractor and nothing in this Agreement constitutes the Contractor as an agent or employee of the Company.
…
7.3Subject to the terms of the Agreement, the parties acknowledge that the Contractor is solely responsible for controlling the manner in which the Contractor provides the Services at the Site.
A determination of the question of whether Mode 2 had, for remuneration, agreed with the appellant to provide a worker to carry out work for the appellant depends on the construction of the agreement.
Clause 2 of the agreement stipulated that Mode 2 will provide 'Services' (as defined in cl 1.1) to the appellant at the site (the workplace), and expressly referred to Schedule 4, which set out the job description of a 'Sorter'.
On its face, cl 2 suggests that Mode 2 agreed to provide the 'Services' in respect of a sorter(s). The 'Services' set out in Schedule 2 relate to personnel issues for labour/workers, and are consistent with the supply or provision of labour to the appellant, rather than Mode 2 performing work for the appellant. Schedule 3 set out the hourly rates of pay for 'Sorters', 'Operators' and 'Lead Supervisors'. [14]
[14] Schedule 3 sets out the hourly rates of fees, being normal rates, overtime rates, and Sunday rates, and specifies that allowances are included.
The only reference to the 'performance of recycling work' is in respect of the 'basic objective' comprising the sorter's job description in Schedule 4. However, the 'responsibilities' for the job can properly be characterised as relating to labour related requirements (e.g. occupational safety and health).
If Mode 2 itself agreed, under the agreement, to perform work for the appellant, as opposed to agreeing to provide labour/workers to carry out work for the appellant, one would expect that the obligations in the agreement would clearly set out the work that was to be performed at the appellant's workplace. However, there is no description or detail in any of the 'Services', as defined, in Schedule 2, which refers specifically to recycling work.
By regard to these express provisions of the agreement, her Honour concluded beyond reasonable doubt that, under the agreement, Mode 2 had, for remuneration, agreed with the appellant to provide workers, including Mr Rathinasabapathy, to carry out work for the appellant.
Her Honour then went on to find that in any event, to the extent that the agreement is ambiguous because the scope of the applicability of the agreement gives rise to a 'constructional choice', as to whether Mode 2's obligation was for the performance of work or the provision of workers, extrinsic evidence of the surrounding circumstances of the agreement known to the parties at the time of the transaction, is admissible to assist in the interpretation of the agreement.
Her Honour then had regard to what was said by Mr Salvatore Mangione when interviewed by Inspector Trayner as admissible evidence of the surrounding circumstances of the agreement, including the objective background behind it and the parties presumed (not subjective) intention. This evidence was as follows:[15]
[15] Record of Interview 1, Salvatore Mangione, 64 - 66 and 83 - 84; Unreported reasons of presiding magistrate delivered 10 July 2020, [64].
KT [Inspector Trayner]: Alright, so, [Mani had] been provided by Mode 2 Group ... to work for [RRS]?
SM: Correct.
...
KT: ... with [Mode 2] and [RRS]. ... was there an agreement between the two companies?
SM: Correct, there is, yeah.
KT: And ... so what can you tell me about that?
SM: ... there's ... an agreement set ... I went to a tender process ... to look for ... a labour hire ... company, because we had a lot of issues maintaining staff ... in that particular area ...
...
KT: ... [S]o [De Gee was] the sole person you've had ... discussions about
…
KT: … providing labour hire workers?
SM: Yep.
SM: ... we were pretty in depth in ... dealing with two different companies, in regard to supplying the labour ... [W]hen [De Gee] … Mode 2 approached ... myself ... I asked him to come in ... [W]e spoke about the process ... he was very comfortable.
Her Honour then found that there was other evidence consistent with the conclusion that Mode 2 did, for remuneration, agree with the appellant to provide workers (including Mr Rathinasabapathy) to carry out work for the appellant, as opposed to performing work for the appellant:
(a)Mode 2 issued an invoice to the appellant on 12 February 2016, for 'labour supplied at Instant Waste ... for the fortnight ending ...'.[16] Salvatore Mangione confirmed that the appellant paid Mode 2 for the provision of workers pursuant to an invoice;
(b)Mr De Gee had limited access to the workplace and did not monitor in any way the work which the workers performed at the appellant's workplace.[17]
3.2 General principles - Construction of contracts
[16] Exhibit 2, Tab 3.
[17] Record of Interview 1, Salvatore Mangione, 68.
In Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd, the plurality set out the following established principles:[18]
In determining the meaning of the terms of a commercial contract, it is necessary to ask what a reasonable businessperson would have understood those terms to mean. That inquiry will require consideration of the language used by the parties in the contract, the circumstances addressed by the contract and the commercial purpose or objects to be secured by the contract.
Ordinarily, this process of construction is possible by reference to the contract alone. Indeed, if an expression in a contract is unambiguous or susceptible of only one meaning, evidence of surrounding circumstances (events, circumstances and things external to the contract) cannot be adduced to contradict its plain meaning.
However, sometimes, recourse to events, circumstances and things external to the contract is necessary. It may be necessary in identifying the commercial purpose or objects of the contract where that task is facilitated by an understanding 'of the genesis of the transaction, the background, the context [and] the market in which the parties are operating'. It may be necessary in determining the proper construction where there is a constructional choice.
[18] Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) 256 CLR 104, 116 ‑ 117, [47] - [49] (French CJ, Nettle & Gordon JJ) (footnotes omitted).
To these general principles of construction, the principle that definitions do not have substantive effect and should not be construed in isolation from the operative provision or provisions in which the definitions appear must also apply.[19] The usual rules of construction of contracts require that the relevant definitions are to be inserted into the operative provisions of a contractual term.[20]
[19] Black Box Control Pty Ltd v TerraVision Pty Ltd [2016] WASCA 219 [42(11)]; applied in Tokio Marine & Nichido Fire Insurance Co Ltd v Holgersson [2019] WASCA 114 [51].
[20] Black Box Control Pty Ltd v TerraVision Pty Ltd [2016] WASCA 219 [42(11)]; applied in Tokio Marine & Nichido Fire Insurance v Holgersson [2019] WASCA 114 [51].
Construing a commercial contract depends on finding the meaning of the language of the contract,[21] and what each party by words and conduct would have led a reasonable person in the position of the other party to believe.[22]
[21] Young Investment Group Pty Ltd v QBE Insurance (Australia) Ltd [2019] WASC 74 [102] (Quinlan CJ); applying Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253 [98] (Heydon & Crennan JJ).
[22] Young Investment Group Pty Ltd v QBE Insurance (Australia) Ltd [2019] WASC 74 [102] (Quinlan CJ); applying Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 [40] (Gleeson CJ, Gummow, Hayne, Callinan & Heydon JJ); Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd [2017] HCA 12; (2017) 261 CLR 544 [16] (Kiefel, Bell & Gordon JJ).
Where a formula of words has been accepted by the courts, the parties are taken to have included that accepted meaning into the words chosen.[23]
3.3 Ground 1 - The agreement between Mode 2 and the appellant
3.3.1 The appellant's submissions
[23] Todd v Alterra at Lloyd's Ltd [2016] FCAFC 15; (2016) 239 FCR 12 [42] ‑ [43]; Johnson v American Home Assurance Co [1998] HCA 14; (1998) 192 CLR 266, 272 - 276 [19]; citing Legal & General Insurance Australia Ltd v Eather (1986) 6 NSWLR 390, 394 (Kirby P).
The appellant's contentions in respect of this ground are as follows.
At trial, it was not in dispute that the sorters were employed by Mode 2 or that they performed work at the premises of the appellant, under the direction of the appellant. However, the appellant disputed that the work was performed under an arrangement that satisfied the elements of s 23F of the OSH Act.
It was the prosecution case that the agreement signed by Salvatore Mangione and Tom Mangione for the appellant, and by Mr De Gee for Mode 2 was the only relevant agreement for the purposes of s 23F(3)(a). The presiding magistrate also found that the agreement was the only agreement between Mode 2 and the appellant.
At trial, the appellant contended that there was reasonable doubt about the proper construction of the agreement such that the court could not be satisfied beyond reasonable doubt that s 23F applied. In particular, the appellant argued that the prosecution had failed to prove that a labour arrangement existed, because it was reasonably possible that the agreement was not an agreement for the purposes of s 23F(3)(a), that is an arrangement where an agent had for remuneration agreed with the client to provide a worker to carry out work for the client.
The basis of the argument put at trial was that the 'Services' were defined in cl 1.1 of the agreement by reference to Schedule 2, and that although cl 2 refers to Schedule 4 (a job description for a sorter, which is to 'perform process work to aid the process and sort (sic) of recyclable materials'), none of these clauses refer to the provision of labour.
It was argued by the appellant that Schedule 2 describes the 'Services' by way of things to be carried out by Mode 2 (i.e. staff training, inductions, compliance with Council contractual requirements and daily housekeeping as to PPE). Schedule 2 also contains as part of the 'Services' to be carried out by Mode 2 under the heading 'Acceptance of Material' which states:
RRS will agree a daily schedule with the Contractor to remove the majority of the tonnes processed by the plant on the basis of full loads only. This is in recognition of the fact that storage capacity on the site is limited. In the event processed material is not moved in align with the agreed programme, the Contractor must notify RRS and RRS will organise the removal of the excess tonnes as soon as possible.
In addition, the appellant argues that while Schedules 3 and 4 contemplate the hourly rates of pay for various job descriptions, the agreement does not state anywhere that Mode 2 is providing labour to the appellant.
For these reasons, the appellant contends that the specified 'Services' contemplate the provision of services by Mode 2 that are not reconcilable with a labour hire arrangement. It is also contended that Schedule 2 has clearly been drafted so as to apply to waste processing work at the appellant's workplace and that the contractor (Mode 2) was responsible for the performance of work for the appellant rather than the provision of labour.
This construction is said to be advanced also by Mode 2's obligations in clause 3, particularly 3.1 - 3.4, which contains various warranties as to Mode 2's competence and diligence in the performance of the 'Services'.
When regard is had to all of these provisions, the appellant contends that the express terms of the agreement are all consistent with a relationship of principal and contractor and inconsistent with a labour hire arrangement.
It is claimed that the 'Services' identified in the first limb of Schedule 2 might relate to 'personnel issues for labour/workers' but that does not 'suggest', and does not result in, an agreement to provide a worker to carry out work for the appellant. At the highest, it is said to indicate parts of the work or 'services' to be undertaken by Mode 2. The reference to hourly rates in Schedule 3 is also said to not indicate or determine an agreement to provide a worker to carry out work for the appellant. It is said to indicate the basis on which Mode 2 was to be paid for providing the 'Services'.
The only other evidence of the arrangement between the appellant and Mode 2 is an invoice (Exhibit 2, Tab 3) issued by Mode 2 to the appellant on 12 February 2016, which shows a lump sum (with no breakdown) with the entry 'labour supplied at Instant waste …'. For the fortnight ending ...'. The invoice confirms that a payment was made from the appellant to Mode 2, but nothing more about the arrangement under which that payment was made.
In respect of the presiding magistrate's reasons, the appellant points out that the core reasoning of her Honour was that cl 2, read with the description of the 'Services' in Schedule 2 and the 'Job description' in Schedule 4, suggested that Mode 2 agreed to provide 'Services' in respect of a sorter(s) rather than agreeing to perform work for the appellant.
The appellant contends the presiding magistrate found that the only reference 'to the performance of recycling work' was in Schedule 4, which finding, the appellant claims, overlooks the second of two obligations in Schedule 2, the first of which requires Mode 2 to agree to a daily schedule to remove the majority of the tonnes processed by the plant, and the second is that if material is not moved in line with the agreed programme, Mode 2 was to organise a removal of the excess tonnes as soon as possible. The appellant contends that her Honour's reasons do not explain how the second obligation of Schedule 2 can fit with her Honour's construction of the agreement.
Insofar as the presiding magistrate's reasoning had regard to extrinsic evidence, being part of a record of interview with Mr Salvatore Mangione, the appellant contends her Honour erred, on three grounds:
(a)the prosecution confined its case on s 23F to the four corners of the agreement. Nothing was said in opening or closing about extrinsic evidence or its application to the agreement. In these circumstances, it was not open to her Honour to give consideration to a formulation of the prosecution case that was never relied upon by the prosecution at trial, and certainly not without first giving notice to the appellant;[24]
(b)that part of the record of interview was inadmissible because whatever label or characterisation Mr Salvatore Mangione placed on the relationship between the appellant and Mode 2, it was an inadmissible opinion about the proper effect of the agreement, which was a question of law; and
(c)the admission of that part of the record of interview was inadmissible because there are limits on the way in which extrinsic evidence may be used to construe a contract. A court may admit evidence of mutually known facts to identify the meaning of a descriptive term and of the genesis and aim of the transaction, but it cannot receive evidence from one party as to its intentions and construe the contract by reference to those intentions.[25]
[24] Nuhana v The State of Western Australia [2018] WASCA 79, [69].
[25] DTR Nominees Pty Ltd v Mona Homes Pty Ltd [1978] HCA 12; (1978) 138 CLR 423, 429 (Stephen, Mason & Jacobs JJ).
Finally, the appellant contends that her Honour erred in construing the agreement by having regard to post-contractual conduct, being, first, the invoice issued to the appellant on 12 February 2016, and, second, the fact that Mr De Gee had limited access to the workplace and did not monitor in any way the work performed at the appellant's workplace.
3.3.2 Ground 1 - Disposition - Was it not reasonably open on the whole of the evidence for the presiding magistrate to find beyond reasonable doubt that the labour hire arrangement existed between the appellant and Mode 2?
It is clear that her Honour erred in construing the agreement by regard to part of the record of interview with Mr Salvatore Mangione. This is because regard cannot be had to a party's subjective intention to determine the presumed intention of the parties when the only surrounding circumstances are evidence of subjective intention.
Extrinsic evidence of intention is only admissible where a latent ambiguity arises in a contractual provision, providing the ambiguity cannot be resolved after taking into account the ordinary principles of construction and the other admissible extrinsic evidence. Latent ambiguity arises where there is, on a written contract, an apparently unambiguous reference to one person or thing, but, in fact, the reference is equally applicable to more than one person or thing. In these circumstances, extrinsic evidence is receivable to resolve the equivocation.[26]
[26] Heydon JD, Heydon on Contract [9.620].
The ambiguity identified by the presiding magistrate cannot be characterised as a latent ambiguity.
The fact that her Honour had regard to inadmissible evidence does not, in this matter, lead to a miscarriage of justice. This is because it is clear from her Honour's reasons that her Honour only had regard to this evidence on the basis if it could be found that the agreement was ambiguous. However, her Honour's reasons at [61], her Honour determined that no ambiguity arose in the agreement because she had found beyond reasonable doubt that under the agreement, Mode 2 had, for remuneration, agreed with the appellant to provide workers, including Mr Rathinasabapathy, to carry out work for the appellant.
There are fundamental difficulties with the argument put on behalf of the appellant that, on the proper construction of the agreement, it was not open to find that Mode 2 had agreed with the appellant to provide workers, including Mr Rathinasabapathy, to carry out work (as sorters) for the appellant for the purposes of s 23F(3)(a) of the OSH Act.
The first is that when the definition of 'Services' is read into the operative provisions of the agreement, the services to be provided by Mode 2 to the appellant were not confined to the 'Services' specified in Schedule 2, or defined only by the 'Services' specified in Schedule 2 or the 'acceptance of material' clause in Schedule 2.
The appellant's argument fails to give effect to the terms of the agreement when construed by the definitions read into the relevant express provisions of the agreement, and when the terms of the agreement are read together as a whole.
The second is that the argument ignores the fundamental indicia of a labour hire agreement, which indicia is provided for in the express terms of agreement. A characteristic feature of all labour hire arrangements is that one party, a labour hirer, arranges for a worker or workers (either employees of the hirer or persons who independently contract to the hirer) to perform work for another party, who is usually the client of the labour hirer.
What emerges from the express provisions of the agreement is that the appellant was not obliged to pay the persons (the workers who carried out the work) because the payments were made to Mode 2 as a Fee,[27] for work performed by persons engaged by Mode 2. The payments were made to the benefit of Mode 2, who derived remuneration from the appellant for the provision of the persons who carried out the work (in the business of the appellant[28]). Mode 2 had control over who provided 'Services' at the site (the workers) in that it could withdraw a worker from the assignment at the request of the appellant.[29]
[27] Exhibit 34, cl 5, Schedule 3.
[28] This point is relevant to Ground 2 of the appeal.
[29] Exhibit 34, cl 7.4.
The third is that the fact that the terms of the agreement are all consistent with the relationship of principal and contractor does not render such an agreement inconsistent with a labour hire arrangement. To the contrary, the nature of the relationship created by the terms of the agreement is to provide services, which include the provision of the specified services in Schedule 2 (staff training, site inductions etc) and also to provide workers, to perform process work to aid the process and sort recyclable materials, whose work was to be carried out in accordance with the job description in Schedule 4, and to provide any other services as reasonably requested by the appellant from time to time.
Clause A and B of the recitals provide that the Contractor (Mode 2) has offered to provide the Services to the Company (the appellant), and the appellant engages Mode 2 to provide the Services (specified in Schedule 2 and any other services as reasonably requested from time to time by the appellant) to the appellant at the Site (50 Clune Street, Bayswater) during the Term, on the terms and conditions of the agreement.
The first sentence of cl 2 reflects the recitals and creates an obligation on Mode 2 to provide the Services (the services specified in Schedule 2 and any other services as reasonably requested from time to time by the appellant) at the Site for the Term on the terms and conditions set out in the agreement. The second sentence of cl 2 provides that the 'Term may be extended by agreement between the parties'. In cl 2 there is a third sentence in brackets '(Refer: Schedule 4 Job Description)'.
When the definition of Services is read into the first sentence of cl 2 and the first sentence is read together with the third sentence in brackets, cl 2, in the context of the rights and obligations expressly provided for in cl 3, cl 4, cl 5 (including Schedule 3), cl 6, cl 7, cl 9 cl 10 and cl 16, is to be construed as an obligation on Mode 2 to provide the 'Services' specified in Schedule 2 and Schedule 4 (being part of the category of any other services as reasonably requested from time to time by the appellant).
This construction emerges from the following provisions of the agreement, which construction reflects the characteristic features of a labour hire arrangement.
Clause 7.3 provides that, subject to the terms of the agreement, the parties acknowledge that Mode 2 is solely responsible for controlling the manner in which it provides the Services at the Site.
Clause 3.11, cl 6.1(a) and (b), cl 9.1 and cl 10 require Mode 2 to pay its employees, contractors and agents remuneration and benefits, including salaries and wages, annual leave, sick leave, superannuation, long service leave etc, and pay any taxes and duties, including income tax, PAYG withholding tax, fringe benefits tax, payroll tax and GST. Such provisions contemplate the provision of services which provide for the provision of labour, that is, workers, for the appellant.
The provisions of Schedule 2, Schedule 3 and Schedule 4 do not have independent operative effect. Pursuant to cl 5.1 and cl 5.2, the appellant was required to pay Mode 2 the Fee as calculated in accordance with Schedule 3, which Fee was payable on the receipt of a Tax Invoice (which meaning is as given in A New Tax System (Goods and Services Tax) Act 1999 (Cth)) detailing the Services (the services specified in Schedule 2 and any other services as reasonably requested from time to time by the appellant) provided by Mode 2.
The 'Fees' as specified in Schedule 3, are fees which comprise hourly rates for morning and afternoon shifts (being work performed in the morning and afternoon) in respect of which a normal rate is specified, a separate rate for overtime is specified, and a further separate rate for Sundays is specified for three classifications of workers, one classification of which is 'sorters' (the other classifications are 'operators' and 'lead supervisors').
Given that no other fees are specified as being payable pursuant to the terms of the agreement, other than as calculated by Schedule 3, it is clear from these provisions that the Services contemplated to be provided by Mode 2 pursuant to the terms of the agreement were for workers who were engaged in work as sorters, operators and lead supervisors for morning and afternoon shifts performed during specified hours, but also allowing for overtime work to be performed and work on Sundays.
This construction is consistent with cl 4.1, which provides that extraordinary breakdown maintenance or extraordinary labour may be required due to structural failure or a proven design defect of plant or equipment at the Site. The second sentence in this clause also provides that if such occasions occur, the appellant's nominated representative must be contacted immediately and no work is to commence by Mode 2 unless approved by the appellant. This provision contemplates that additional hours of work or additional workers may be required to be provided by Mode 2 from time to time to deal with the matters specified in cl 4.1.
The acceptance of material clause in Schedule 2 cannot be construed as a provision that specifies services to be provided by Mode 2. The acceptance of material clause in Schedule 2 does not require Mode 2 to remove any processed material from the Site, nor does this provision attract any remuneration payable to Mode 2. The obligation in the first sentence simply requires the parties to agree a daily schedule to remove the majority of the tonnes processed by the plant on the basis of full loads only, and the third sentence requires the appellant (and not Mode 2) to remove the excess tonnes as soon as possible in the event that processed material is not moved in line with the agreed programme. What is to be in a daily schedule is not specified in the agreement, but this clause contemplates that such matters are to be agreed by the parties.
I do not agree that the presiding magistrate had, in [65], regard to post-contractual conduct in construing the agreement. In [44(b)] of her Honour's reasons, her Honour found that she concluded beyond reasonable doubt that Mode 2 did, for remuneration, agree with the appellant to provide a worker, Mr Rathinasabapathy, to carry out work for the appellant for the purposes of s 23F(3)(a). In order to make such a finding, her Honour was necessarily obliged to consider whether, in fact, on the date in question, 28 January 2016, the agreement made between the appellant and Mode 2 was operative in respect of the work performed by Mr Rathinasabapathy at the workplace.
In particular, to make this finding it was necessary for her Honour to determine:
(a)whether the works performed by Mr Rathinasabapathy were works performed pursuant to, and in accordance with, the terms of the agreement made between Mode 2 and the appellant;[30] and
(b)whether cl 5.2 of the agreement was performed by the appellant for work performed on that day by Mr Rathinasabapathy, that is, had a Fee been claimed by Mode 2 that was calculated in accordance with Schedule 3 and forwarded to the appellant by Mode 2 for the provision of Services (performed by Mr Rathinasabapathy).
[30] Post-contractual conduct is admissible.
The invoice referred to by her Honour is an invoice dated 12 February 2016 for an amount of $5,897.38 (inclusive of GST) for labour supplied at Instant Waste - Bayswater for the fortnight 'ended' 9 February 2016. Attached to the invoice is a document titled 'Mode 2 Group Pty Ltd … Bi-Weekly Invoice Information Sheet' and which contains a spreadsheet for labour supplied for the period from 27 January 2016 to 9 February 2016, and lists the names of 10 persons under the heading 'Labour Details', with each name classified as 'Sorter' and indicating the number of hours of work that each of those persons worked, whether there was a claim for time worked at the ordinary rate, and whether there were overtime hours and the overtime rate. Mr Rathinasabapathy's name is listed as person number 1 on the sheet and the invoice indicates that he worked 7.5 hours on 28 January 2016 (being the date of the accident).[31]
[31] Exhibit 5, Attachments SM15 and SM16, and Exhibit 2, Tabs 3 - 4 (agreed documents). It is notable that the accuracy of what is stated in the invoice was not challenged and that Mr Salvatore Mangione admitted in his record of interview that the appellant paid Mode 2 for the work performed by Mr Rathinasabapathy at the workplace; Exhibit 5, 68, 81 - 82.
Clearly this uncontradicted evidence demonstrated the agreement between the appellant and Mode 2 was operative on the day in question, and applied to the work carried out by Mr Rathinasabapathy.
For these reasons, Ground 1 has no prospects of success, and leave to appeal on this ground should be refused.
The evidence referred to in [65] is also referred to in [46(d)] of her Honour's reasons as evidence that her Honour relied upon in making a finding that Mode 2 was carrying on the business of providing workers to carry out work for clients within the meaning of s 23F(1) of the OHS Act (that is, it was an 'agent' which finding is the subject of Ground 3 of the appeal and is considered below in 3.5).
3.4 Ground 2 - Was there an agreement between Mr Rathinasabapathy and Mode 2 that applied to the carrying out of the work by Mr Rathinasabapathy for the appellant on the date of the accident?
3.4.1 The appellant's submissions - Ground 2
At the conclusion of the trial, the appellant filed written closing submissions in which a submission was made that there was no evidence before the court to satisfy the requirements of s 23F(3)(c) and (d) (that is, there was an agreement (which may be a contract of employment) between the worker (Mr Rathinasabapathy) and the agent (Mode 2) as to the carrying out of work including in respect of remuneration and other entitlements; and that (worker) agreement applied to the carrying out of the work by the worker (Mr Rathinasabapathy) for the client (the appellant)).
I agree that the presiding magistrate misstated in her reasons at [40] that the matters in s 23F(3)(c) and (d) were not in dispute. However, no substantial miscarriage of justice arises because there was cogent evidence before the court, which was not in dispute, and that establishes beyond reasonable doubt that the requirements of s 23F(3)(c) and (d) had been met.
In the appellant's written closing submissions, filed in the Magistrates Court, the following submissions about the evidence were made:
209.For s 23F of the Act it does not matter whether Mani was an employee of Mode 2 or a Contractor - what is required is proof of the arrangement between Mode 2 and RRS, and that the agreement between Mani and Mode 2 applied to the carrying out of the work for RRS.
210.Mani was originally paid as an employee of Mode 2. At some point, Mode 2 ceased paying super and PAYG tax and moved to a system of generating invoices from Mani to Mode 2 under agreed rates. As part of that change Mani entered into an agreement on 26 August 2015 (Mani's Contract).
211.Mani gave limited evidence about his work arrangements. His evidence was that he was employed by Mode 2, he was paid by Mode 2 and he worked at the premises of RRS. He gave evidence that at some point his arrangement with Mode 2 changed whereby he was no longer paid using a Tax File Number and had to obtain an Australian Business Number (with the assistance of staff at Mode 2). His evidence was that his shift times were determined by Mode 2.
212.There is no other evidence of Mani's arrangement with Mode 2 except for Mani's Contract.
…
220.It is not in dispute that Mani was paid by Mode 2 on an hourly rate and that he performed that work at RRS.
221.The issue in dispute is whether Mani's agreement with Mode 2 (whatever agreement applied as at 28 January 2016) was an agreement for the carrying out of work by Mani for RRS.
Although the presiding magistrate found that Mr Rathinasabapathy was an employee of Mode 2, it appears that the contractual arrangements entered into by Mr Rathinasabapathy and Mode 2 may not be capable of being characterised as a contract of employment but rather an engagement by Mode 2 of Mr Rathinasabapathy to provide services as a sorter, as a contractor.[32] However, as the appellant pointed out in their closing submissions filed in the Magistrates Court, it is immaterial whether Mr Rathinasabapathy was engaged by Mode 2 as a contractor or employee. This is because s 23F applies to a 'worker', which is defined in s 23F to include an employee or a contractor.
[32] It should be noted that the majority of the High Court recently observed in Workpac Pty Ltd v Rossato [2021] HCA 23; (2021) 392 ALR 39 [57] (Kiefel CJ, Keane, Gordon, Edelman, Steward & Gleeson JJ) that a court can determine the character of a legal relationship between the parties only by reference to the legal rights and obligations which constitute that relationship (and not by the real substance, practical reality and true nature of the relationship, which was the test applied by the Full Federal Court at first instance (see [37])).
A contract was entered into by Mr Rathinasabapathy and Mode 2 on 26 August 2015,[33] which described Mode 2, by reference to its full name and ABN number, as 'the Company' and described Mr Rathinasabapathy, by reference to his full name together with an ABN number, as 'the Contractor'. Pursuant to cl 1.1 of this agreement, Mr Rathinasabapathy agreed to provide the services described in the Scope of Services specified in Schedule C to Mode 2 for a period of 4 months to 24 December 2015, and, thereafter, extendable at the mutual consent of both parties.
[33] Exhibit 2, Tab 15.
The Scope of Services in Schedule C was for the services of a Sorter to report to a supervisor, valid from the Agreement Date and valid to, 'For the period as mutually consented between the parties'.
Clause 1.0 of Schedule C provided that Mr Rathinasabapathy would directly report to the Client Supervisor of Mode 2 and be directed in his activities by the Client Supervisor, or their appointed nominee, and/or the Management. The terms 'Client Supervisor' and 'Management' are not defined. However, cl 6.1 required Mr Rathinasabapathy to report to and comply with the reasonable directions of Mode 2's representative mentioned in Schedule C, who was responsible for ensuring that the Services were carried out in a professional manner in accordance with the Scope of Services and the directions of Mode 2's Clients. There is also reference to requirements to comply with safety rules etc in inductions conducted by Mode 2's clients in cl 9.2 and a term noting that Mr Rathinasabapathy agreed to consent to alcohol and drug testing as required by Mode 2's Client in cl 9.0 of the agreement.
The appellant argued at first instance, and in the appeal, that Mr Rathinasabapathy's contract makes no reference to him performing work for the appellant, nor do his contracted obligations with Mode 2 make any reference to the arrangement between Mode 2 and the appellant.
It is also argued by the appellant that there was no evidence of what agreement applied between Mr Rathinasabapathy and Mode 2 after 24 December 2015, and there was no evidence that his contract continued after that date by mutual consent. Consequently, in this appeal the appellant put a submission that in the absence of this evidence, and in circumstances where the contract between Mode 2 and Mr Rathinasabapathy made no reference to work being performed by the appellant, it was not reasonably open to find that the prosecutor had proved the facts stated in s 23F(3)(c) and (d).
3.4.2 Principles - Circumstances where an agreement may be inferred
The express terms of the contract between Mr Rathinasabapathy and Mode 2 provided for the term of the agreement to be extended by mutual consent. The appellant argues there was no evidence before the court at first instance in respect of which it could be found that there was an express offer and acceptance of terms to extend the term of the agreement.
However, when no offer or acceptance can be identified, a contract can be found (including an agreement to vary or extend the term of an existing contract) if it is possible to infer from the relevant facts the conclusion that the parties have agreed to incur reciprocal promissory obligations.[34] In Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd, the New South Wales Court of Appeal had to decide whether the terms of a standard contract that had not been signed applied to give a firm of managing architects security over land.[35] The architects performed a considerable amount of work for the owners of the land and, after some time, submitted a standard contract to be signed. Although the document was never signed, the parties proceeded in a manner that was consistent with the terms of the unsigned contract. The Court of Appeal decided that the terms of the written contract should apply because there was an implied acceptance of the terms of the written contract stemming from the conduct of the parties.
[34] Toyota Motor Corp Australia Ltd v Ken Morgan Motors Pty Ltd [1994] 2 VR 106, 178 (Tadgell JA).
[35] Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523.
As her Honour pointed out in [28] of her reasons, such an inference cannot be drawn in criminal proceedings if there is a reasonable hypothesis consistent with innocence.
3.4.3 Ground 2 - Was it not reasonably open on the whole of the evidence of the court to find beyond reasonable doubt that an agreement between Mr Rathinasabapathy and Mode 2 applied to the carrying out of work by Mr Rathinasabapathy for the appellant?
Although the appellant concedes that while in certain circumstances it may be appropriate to presume that two parties consented to extend the terms of a fixed term contract, the existence and terms of an engagement are questions of fact to be determined by the court. The appellant also makes a submission that the prosecutor at trial did not adduce any evidence of the agreement that applied at the date of the accident. In particular, no evidence was led from Mr Rathinasabapathy or Mr De Gee on the issue and the court made no findings of fact about it. Consequently, it is claimed that there was no basis to apply the presumption in this matter.
Rather, when her Honour came to consider the knowledge element of gross negligence, she was careful to direct herself as to the requirement for actual knowledge in [185] and [186] of her reasons, which direction the appellant says was a correct statement of the law. When her Honour correctly directed herself as to how actual knowledge 'may' be inferred in [189], and as to the circumstances from which it could be inferred that the appellant knew in [198], it was in light of the principles that she had applied by her directions in [24] to [28], [185] and [186], not somehow indicating a suddenly and inexplicably lesser standard of proof.
In light of my findings in respect of Ground 7 and Ground 8 of the appeal, it is not necessary to consider Ground 5 of the appeal, because this ground requires an analysis of her Honour's reasons of finding that the appellant had actual knowledge that the contravention would be likely to cause the death of, or serious harm to, a person to whom a duty is owed under s 19(1) of the OSH Act.
5.0 Ground 9 -Whether Improvement Notice 6150097 was valid
5.1 The appellant's and the respondent's submissions
Ground 9 relates only to Charge PE 39837/18, and to Improvement Notice 6150097 (the Improvement Notice), issued to the appellant on 4 March 2015.
In Ground 9, the appellant contends that that her Honour erred in law in finding the Improvement Notice was valid.
This ground of appeal concerns one issue only, and that is the effect of the requirement in s 48(2) of the OSH Act for the inspector who issues an improvement notice to state in the notice his or her reasonable grounds for forming the opinion that the person to whom the notice is issued is contravening a provision of the OSH Act (including the regulations made under the OSH Act).
The power of an inspector to issue an Improvement Notice is conferred in s 48 of the OHS Act. Sections 48(1), (2) and (4) provide:
48.Improvement notices, issue and effect of
(1)Where an inspector is of the opinion that any person -
(a)is contravening any provision of this Act; or
(b)has contravened a provision of this Act in circumstances that make it likely that the contravention will continue or be repeated,
the inspector may issue to the person an improvement notice requiring the person to remedy the contravention or likely contravention or the matters or activities occasioning the contravention or likely contravention.
(2)An improvement notice shall -
(a)state that the inspector is of the opinion that the person -
(i)is contravening a provision of this Act; or
(ii)has contravened a provision of this Act in circumstances that make it likely that the contravention will continue or be repeated; and
(b)state reasonable grounds for forming that opinion; and
(c)specify the provision of this Act in respect of which that opinion is held; and
(d)specify the time before which the person is required, to remedy the contravention or likely contravention or the matters or activities occasioning the contravention or likely contravention; and
(e)contain a brief summary of how the right to have the notice reviewed, given by sections 51 and 51A, may be exercised.
…
(4)Subject to sections 51 and 51A, if a person -
(a)is issued with an improvement notice; and
(b)does not comply with the notice within the time specified in it,
the person commits an offence.
The Improvement Notice issued to the appellant by an inspector on 4 March 2015 stated as follows:
Issued to:
RESOURCE RECOVERY SOLUTIONS PTY LTD
l.In relation to: GUARDING OF PLANT
at 50 CLUNE ST BAYSWATER 6053 on 04 Mar 2015
I have formed the opinion that you are contravening regulation 4.37(l)(f) of the Occupational Safety and Health Regulations 1996 and the grounds for my opinion are: My enquiries have revealed that this company is the employer at this workplace. In the automated recycling facility I saw numerous items of fixed powered plant that do not have adequate guarding, for example conveyor belt CVI5 and others. I saw that there are dangerous moving parts where the conveyor belts meet rotating drums and rollers, creating in-running nip points. Enquiries revealed that employees work in this area and can access these dangerous moving parts, as evidenced by the injury on 23/02/2015. It would be practicable to install adequate guarding of these items of plant.
You are required to remedy the above by no later than 30 June 2015 at 1700 hours.
2.You are directed to take the following measures: Ensure that ALL dangerous moving parts of plant at this workplace are adequately guarded in accordance with OS&H Regulation 4.29.
For further information refer to 'Machinery and Equipment Safety - an Introduction' and 'Code of Practice - Safeguarding of Machinery and Plant (2009)', both of which have been provided today.
The Improvement Notice stated that the inspector had formed the opinion that the appellant was contravening reg 4.37(l)(f) of the Occupational Safety and Health Regulations 1996 (WA) (OSH Regulations). Regulation 4.37(1) provides:
4.37.Inspection etc. of plant, duties of employer etc. as to
(1)A person, who at a workplace, is an employer, a main contractor, a self-employed person, a person having control of the workplace or a person having control of access to the workplace must ensure -
…
(f)that every dangerous part of a fixed, mobile or hand held powered plant is, as far as practicable, securely fenced or guarded in accordance with regulation 4.29 unless the plant is so positioned or constructed that it is as safe as it would be if securely fenced or guarded;
The requirements of guarding of plant are specified in reg 4.29(i). Regulation 4.29(i) provides:
4.29.Means of reducing risks in relation to plant
The means referred to in regulations … 4.37(1)(f) are -
…
(i)ensuring, in the case where guarding should be provided for the plant, that the guarding comprises -
(i)a permanently fixed physical barrier for cases in which, during normal operation, maintenance or cleaning of the plant, no person would need either complete or partial access to the dangerous area; or
(ii)an interlocked physical barrier for cases in which during normal operation, maintenance or cleaning of the plant, a person may require complete or partial access to the dangerous area; or
(iii)a physical barrier securely fixed in position by means of fasteners or other suitable devices sufficient to ensure that the guard cannot be altered or removed without the aid of a tool or key for cases where neither a permanently fixed physical barrier nor an interlocked physical barrier is practicable,
but, if none of the guards described in subparagraphs (i), (ii) or (iii) is practicable, the provision of a presence sensing safeguard system;
The appellant argued at trial, and in the appeal, that the Improvement Notice is invalid because, pursuant to s 48(2)(b), the inspector was required to, but did not, state reasonable grounds for his conclusion in the Improvement Notice that it would be practicable to install adequate guarding to the plant referred to in the notice.
'Practicable' is defined in s 3(1) of the OSH Act, to mean:
reasonably practicable having regard, where the context permits, to -
(a)the severity of any potential injury or harm to health that may be involved, and the degree of risk of it occurring; and
(b)the state of knowledge about -
(i)the injury or harm to health referred to in paragraph (a); and
(ii)the risk of that injury or harm to health occurring; and
(iii)means of removing or mitigating the risk or mitigating the potential injury or harm to health; and
(c)the availability, suitability, and cost of the means referred to in paragraph (b)(iii);
The appellant contends that the statement by the inspector in the Improvement Notice that 'it would be practicable to install adequate, guarding of these items of plant' was merely a statement by the inspector of a conclusion. The appellant also argues that this statement, and the other statements made in the Improvement Notice, did not include any information from which an assessment could be made about whether the conclusion that it was practicable to install adequate guarding was reasonable.
Thus, the appellant contends that unless it can be found that the Improvement Notice set out information from which it could be assessed whether the inspector's opinion (that it was practicable to install adequate guarding) was reasonable, the notice is invalid.
The appellant argues the precondition for the exercise of the power to issue an improvement notice, in this matter, was that for the inspector to form an opinion that the appellant had contravened reg 4.37(1)(f) it was necessary for the inspector to form an opinion about two matters. The first is that it was practicable to securely guard parts of the plant that were not guarded, and, second, that to install adequate guarding, the guarding was to satisfy the requirements of reg 4.29(i).
The respondent contends the requirement for an improvement notice to state reasonable grounds for forming an opinion should not be interpreted as an overly demanding test, and that there is no textual basis to construe s 48(2)(b) of the OSH Act as requiring an inspector to state reasonable grounds for each element of the relevant provision that is said to have been contravened.
The respondent also contends that if an inspector issues an improvement notice as a result of forming an opinion that a person is contravening a provision of the OSH Act, or that a person has contravened a provision of the OSH Act, the evident purpose of the improvement notice is to require the person who is issued with the notice to remedy the contravention or likely contravention, or the matters or activities occasioning the contravention or likely contravention.
It is also argued by the respondent that the requirement for an improvement notice to 'state' reasonable grounds for the inspector's opinion in s 48(2)(b) may be contrasted with the requirement for a notice to 'specify' the provision of the OSH Act in respect of which that opinion is held (s 48(2)(c)) and to 'specify' the time by which the contravention or likely contravention is to be remedied (s 48(2)(d)). The difference in the words used is said to be deliberate; that is, an inspector is not required to state in detail reasonable grounds for the purposes of s 48(2)(b). The respondent also makes a submission that the word 'specify' implies a higher standard and a higher level of detail than a requirement to 'state'.
The respondent argues that when all of the statements made in the Improvement Notice are read together, the notice does state reasonable grounds for the inspector forming the opinion that the appellant was contravening reg 4.37(1)(f) of the OSH Regulations. In particular, the respondent contends that the inspector explained in a clear and pragmatic way his reasons for concluding that there was plant at the workplace with dangerous parts that could be better guarded, and consequently that reg 4.37(1)(f) had been contravened. Further that, any reasonable person could understand that explanation, and that the appellant did not contend otherwise at the time the notice was served, and nor did it seek review of the notice for lack of clarity. To the contrary, Mr Salvatore Mangione subsequently gave notification of compliance with the notice.
5.2 Disposition - Ground 9 - Improvement Notice IN 61500197 is invalid
The respondent in their written submissions property points out that it was open to the appellant to challenge the validity of the Improvement Notice at trial.[92]
[92] Re Lawrence; Ex parte Goldbar Holdings Pty Ltd (1994) 11 WAR 549; Australian Crime Commission v Marrapodi [2012] WASCA 103; (2012) 42 WAR 351; Selby v Pennings (1998) 19 WAR 520.
The respondent also points out that when a statute prescribes there must be 'reasonable grounds' for a state of mind (including suspicion and belief), it requires the existence of facts which are sufficient to induce that state of mind in a reasonable person.[93]
[93] George v Rockett [1990] HCA 26; (1990) 170 CLR 104, 112.
As the appellant submits, the power to issue an improvement notice is only conferred pursuant to s 48 of the OSH Act if an inspector forms the requisite opinion, that is, that a person is contravening or has contravened a provision of the OSH Act. The formation of that opinion is an essential prerequisite to the exercise of the power, and as such is a precondition to the exercise of the power.
As the respondent points out, if an inspector forms that opinion, the inspector is conferred with a discretion to issue an improvement notice. This discretion is conferred by the words 'the inspector may issue to the person and improvement notice' in s 48(1), which power only arises if an inspector has formed the requisite opinion. Put another way, the formation of that opinion is an essential preliminary to the exercise of the power to issue an improvement notice.
Pursuant to s 48(2)(b) there must be reasonable grounds for forming that opinion. The forming of the opinion is a jurisdictional fact. The requirement that there be reasonable grounds has the effect that the basis of the opinion must be objectively reasonable. To ascertain whether the opinion formed by the inspector is in fact objectively reasonable, those grounds must be revealed in the improvement notice, that is, it must be a properly performed opinion.
In R v Connell; Ex parte Helton Bellbird Collieries Ltd Latham CJ observed:[94]
[W]here the existence of a particular opinion is made a condition of the exercise of power, legislation conferring the power is treated as referring to an opinion which is such that it can be formed by a reasonable man who correctly understands the meaning of the law under which he acts. If it is shown that the opinion actually formed is not an opinion of this character, then the necessary opinion does not exist. A person acting under a statutory power cannot confer power upon himself by misconstruing the statute which is the source of his power. Thus, in the case of certain provisions in the Income Tax Assessment Act which make the opinion of the Commissioner of Taxation a condition of the imposition of liability upon taxpayers, it has been held that the opinion referred to is an opinion which is neither arbitrary nor extravagant, and which does not take into account considerations which, upon the true construction of the statute, are irrelevant.
[94] R v Connell; Ex parte Helton Bellbird Collieries Ltd [1944] HCA 42; (1944) 69 CLR 407, 430 ‑ 431.
Importantly, a contravention of reg 4.37(1)(f) of the OSH Regulations (not to guard or fence every dangerous part of a fixed, mobile or hand held powered plant) can only arise if it is practicable to guard or fence the plant in question. If it is not practicable to do so, then no contravention can arise. Consequently, the formation of an opinion that it is practicable to install adequate guarding of items of plant referred to in the Improvement Notice is, in essence, the gravamen of the alleged contravention referred to in the notice.
It is clear that the use of the words 'specify the provision of this Act', and 'specify the time before which the person is required, to remedy the contravention' in s 48(2)(c) and (d) of the OSH Act are different to the obligation in s 48(2)(b) to state reasonable grounds for forming the requisite opinion. The former simply requires specification by the identification of a specific provision of the OSH Act or OSH Regulations, such as, in this matter reg 4.37(1)(f), and specification of time for compliance, that is, the specification by the identification of a particular date, or a particular time and date. The latter, that is, the requirement to state reasonable grounds, is different. The requirement to state reasonable grounds is a requirement to state the basis of an opinion.
Where an inspector issues an improvement notice stating he or she has formed the opinion that a person has contravened reg 4.37(1)(f) of the OSH Regulations, unless the reasons why the inspector has formed the opinion that it is practicable to install adequate guarding of items of plant are revealed in the statements made by the inspector in the notice, the reasonableness of the opinion, as to practicability, cannot be ascertained from the information contained in the notice.
The purpose of the requirement in s 48(2)(b) that the inspector state (his or her) reasonable grounds for forming the requisite opinion (in this matter, that guarding of the plant referred to in the Improvement Notice was practicable) is to give notice to the person who is alleged to have contravened, or is contravening, a provision of the OSH Act as to why the inspector formed that opinion (that guarding of the plant was practicable), and to enable an assessment of whether in fact there were reasonable grounds for that opinion.
I have not found it necessary to decide the issue of whether s 48(2)(b) requires an inspector to state reasonable grounds for each element of the relevant provision, which is said to have been contravened. I do not find it necessary to decide because this appeal only concerns the issue of whether the Improvement Notice stated reasonable grounds for the formation by the inspector of an opinion that it was practicable to install adequate guarding of the items of plant specified in the notice.
The statement made by the inspector in the notice that it would be practicable to install adequate guarding of the items of plant referred to in the notice is a bare assertion by the inspector that he had formed an opinion about practicability, but the grounds for that opinion are not revealed.
In the alternative, the respondent argues that if it is found that the Improvement Notice did not state reasonable grounds for the inspector forming the opinion that the appellant was contravening reg 4.37(1)(f) of the OSH Regulations, the Improvement Notice was nevertheless not invalid, and Ground 9 of the appeal must be dismissed in any event. In support of this contention, a submission is put that substantial compliance with the requirement to state reasonable grounds in s 48(2)(b) of the OSH Act is sufficient for an improvement notice to be valid, when that substantial compliance is sufficient to enable the recipient to understand the contravention alleged. This is because there is sufficient information in the Improvement Notice to remedy the contravention or apply for a review of the notice. If this test is applied, then the respondent says the Improvement Notice met this threshold.
In making the alternative submission that Ground 9 should be dismissed irrespective of whether the Improvement Notice did not state reasonable grounds for the inspector forming the requisite opinion because no invalidity arises as substantial compliance is sufficient, the respondent relies upon the approach discussed in Project Blue Sky Inc v Australian Broadcasting Authority, in which the majority said:[95]
An act done in breach of a condition regulating the exercise of a statutory power is not necessarily invalid and of no effect. Whether it is depends upon whether there can be discerned a legislative purpose to invalidate any act that fails to comply with the condition. The existence of the purpose is ascertained by reference to the language of the statute, its subject matter and objects, and the consequences for the parties of holding void every act done in breach of the condition.
[95] Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 [91] (McHugh, Gummow, Kirby & Hayne JJ).
In Forrest & Forrest Pty Ltd v Wilson it was noted that the majority in Project Blue Sky were strongly influenced in reaching the conclusion that the Act in question in that matter was not invalid by the specific legislative provision conferring power and that their Honours were influenced:[96]
[B]y the consideration that the requirement in question regulated the exercise of functions already conferred on the agency, rather than imposed essential preliminaries to the exercise of those functions. Their Honours were also influenced by the circumstance that the provisions did not have 'a rule-like quality which [could] be easily identified and applied', many of the obligations relevant in that case being 'expressed in indeterminate language'. Also important to the decision was the consideration that 'public inconvenience would be a result of the invalidity of the act', especially if those affected by non‑compliance were neither responsible for, nor aware of, the non‑compliance.
[96] Forrest & Forrest Pty Ltd v Wilson [2017] HCA 30; (2017) 262 CLR 510 [62] (footnotes omitted).
The majority in Forrest & Forrest Pty Ltd v Wilson found that substantial compliance had no application to the power conferred on the Minister under the Mining Act and found the nature of the statutory provisions of the Mining Act 1978 (WA) were obligatory. In making this finding, their Honours observed:[97]
The present case is readily distinguishable. A consideration of 'the language of the statute, its subject matter and objects, and the consequences for the parties of holding void' acts done in breach of the Act, reveals that ss 74(1)(ca)(ii), 74A(1) and 75(4a) imposed essential preliminaries to the exercise of the power conferred by s 71 of the Act. That this was so was made clear by both the express terms and the structure of the provisions as sequential steps in an integrated process leading to the possibility of the grant of a mining lease by the Minister. These provisions were not expressed in indeterminate terms: they imposed rules which could be easily identified and applied. In addition, any inconvenience suffered by treating the requirements of the Act as conditions precedent to the exercise of the Minister's power would ensure only to those with some responsibility for the non-observance, whereas (as will be explained) the contrary view would disadvantage both the public interest and individuals who were within the protection of the Act. Finally, and importantly, Project Blue Sky was not concerned with a statutory regime for the making of grants of rights to exploit the resources of a State.
[97] Forrest & Forrest Pty Ltd v Wilson [2017] HCA 30; (2017) 262 CLR 510 [63].
I do not agree that substantial compliance with the requirement to state reasonable grounds in an improvement notice is sufficient for a notice to be valid. This is because a contravention of reg 4.37(1)(f) of the OSH Regulations could not have arisen if adequate guarding of the items of plant specified in the notice was not practicable. Where the evident purpose of the statutory requirement to state reasonable grounds is to reveal from the information stated (as those grounds) whether an inspector in fact objectively had reasonable grounds in exercising his or her discretion to issue an improvement notice, unless those grounds are sufficiently revealed, the reasonableness of that opinion is not examinable.
Consequently, the obligation to state those reasonable grounds for the opinion is obligatory. Unless construed as obligatory, the purpose and object of the provision requiring the statement of reasonable grounds for the opinion is stated it may be difficult to determine whether the essential preliminaries for the power to issue an Improvement Notice has been met.
As the appellant points out, there is no public inconvenience that will result from the invalidity of an improvement notice if it is found there is no room to apply the principle of partial or substantial compliance.
For these reasons, it is clear that the requirements of s 48(2)(b) of the OSH Act must be strictly complied with.
As the appellant properly accepts, the statement of reasonable grounds in an improvement notice need not be overly descriptive, but must be sufficient to reveal the basis of the requisite opinion. How much detail an inspector must reveal of his or her opinion would depend upon the circumstances of the particular contravention that is the subject of the notice in question.
For these reasons, Ground 9 of the appeal is made out, the appeal against conviction on Charge PE 39837/18 should be set aside, a verdict of not guilty entered, and the appeal allowed on this ground.
6.0 Disposition of the appeal, the convictions and the orders that should be made
Leave to appeal on Grounds 1, 2, 3, 5 and 6 should be refused. Leave to appeal on Ground 7 and Ground 8 should be allowed. The appeal on Ground 4 is refused. The appeal should be allowed on Ground 7, Ground 8 and Ground 9.
The power of an appellate court to grant a new trial is discretionary. However, where an appellate court quashes a conviction, it must decide whether it is in the interests of justice to order a new trial. It must be borne in mind in the exercise of the discretion that it is important that there is a public interest in the due prosecution and conviction of offenders, and that it is desirable, if possible, for the guilt or innocence of an accused person to be determined by the trier of fact.[98]
[98] R v Taufahema [2007] HCA 11; (2007) 228 CLR 232 [49] - [51] (Gummow, Hayne, Heydon & Crennan JJ), adopting observations of Gleeson CJ in R v Anderson (1991) 53 A Crim R 421, 453, applied in Gibson v The State of Western Australia [2017] WASCA 141; (2017) 51 WAR 99 [207]; Watson v Vos [2019] WASC 327 [32] (Hall J), and A v Doubikin [2019] WASC 426 [140] (Derrick J).
In deciding whether the interests of justice require a new trial to be had, the court should first consider whether the admissible evidence given at the original trial was sufficiently cogent to justify a conviction, for if it was not, it would be wrong, by making an order for a new trial, to give the prosecution an opportunity to supplement a defective case. Then the court must take into account any circumstances that might render it unjust to the accused to make them stand trial again, remembering that the public interest in the proper administration of justice must be considered, as well as the interests of the accused.[99] In the appeal against the conviction of the breach of s 19(1) in circumstances of gross negligence, pursuant to s 18A and s 19A(1), it would be inappropriate to order a new trial. This is because if the prosecution were afforded an opportunity to amend its particulars, the appellant would be highly likely to have to face a trial of the charge on an entirely different basis.
[99] Director of Public Prosecutions (Nauru) v Fowler [1984] HCA 48; (1984) 154 CLR 627, 630 (Gibbs CJ, Murphy, Wilson, Deane & Dawson JJ), applied in Rye v The State of Western Australia [2021] WASCA 43 [67] (Buss P & Mazza JA).
For this reason, the conviction of the offence of gross negligence, pursuant to s 18A of the OSH Act, should be set aside, the matter should not be remitted for a retrial, and a conviction should be substituted for a general duty charge on Charge PE39876/18, pursuant to s 19A(2) of the OSH Act.
The conviction on the charge of failing to comply with the Improvement Notice should also be set aside, a verdict of not guilty entered and charge PE 39837/18 should be dismissed.
I will hear the parties further as to the orders that should be made to reflect these reasons, including as to costs of the appeal and the cost orders made by the presiding magistrate, and relisting the matter for sentencing of the general duty offence.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
XH
Associate to the Honourable Justice Smith
10 DECEMBER 2021
(Hill J).
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