SafeWork NSW v All Seasons (Aust) Gourmet Produce NSW Pty Ltd; SafeWork NSW v Skevos Kakias

[2022] NSWDC 12

District Court

New South Wales

Medium Neutral Citation:

SafeWork NSW v All Seasons (Aust) Gourmet Produce NSW Pty Ltd; and; SafeWork NSW v Skevos Kakias [2022] NSWDC 12

Hearing dates:

7 December 2021

Date of orders:

11 February 2022

Decision date:

11 February 2022

Jurisdiction:

Criminal

Before:

Strathdee DCJ

Decision:

(1)   The defendant, All Seasons (Aust) Gourmet Produce Pty Ltd, is convicted.

(2)   The appropriate fine is $150,000.00 and the defendant is entitled to a discount of 25% for the early plea.

(3)   Accordingly, I order the defendant, All Seasons (Aust) Gourmet Produce Pty Ltd, pay a fine of $112,500.00.

(4)   The defendant, Skevos Kakias, is convicted.

(5)   The appropriate fine is $50,000.00 and the defendant is entitled to a discount of 25% for the early plea.

(6)   Accordingly, I order the defendant, Skevos Kakias, pay a fine of $37,500.00.

(7) Under s 122(2) of the Fines Act 1996 (NSW) a moiety of the fines imposed be paid to SafeWork NSW.

(8) All Seasons (Aust) Gourmet Produce NSW Pty Ltd and Skevos Kakias to pay the prosecutor’s costs as agreed or assessed.

Catchwords:

CRIMINAL LAW – prosecution – work health and safety – duty of persons undertaking business – risk of death or serious injury – role of costs order in sentencing

SENTENCE – objective seriousness – mitigating factors – aggravating factors – plea of guilty – general deterrence – specific deterrence – capacity to pay –appropriate sentence

OTHER – s 19(1) of the Work Health and Safety Act 2011 (NSW)

Legislation Cited:

Crimes (Sentencing Procedure) Act 1999 (NSW)

Fines Act 1996 (NSW)

Work Health and Safety Act2011 (NSW)

Cases Cited:

Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37; (2016) NSWLR 338

Capral Aluminium Ltd v WorkCover Authority (NSW) (2000) 49 NSWLR 610

Environmental Protection Authority v Barnes [2006] NSWCCA 246

Fisher v Samaras Industries Pty Ltd (1996) 82 IR 384

Inspector Beacham v J & L Marble Pty Ltd [2009] NSWIRComm 100

Jahandideh v R [2014] NSWCCA 178

Kirk v Industrial Court (NSW) (2010) 239 CLR 531

Latoudis v Casey (1990) 170 CLR 534

LawrensonDiecasting Pty Ltd v WorkCover Authority (NSW) (1999) 90 IR 464, 474–5

Markarian v The Queen (2005) 228 CLR 357

McColl v John Watson Building Services Pty Ltd (2004) 137 IR 310

Morrison v Powercoal Pty Ltd (No. 3) (2005) 147 IR 117

Nash v Silver City Drilling (NSW) Pty Ltd [2017] NSWCCA 96

Orbit Drilling v The Queen (2012) 35 VR 399

R v Cage [2006] NSWCCA 304

R v MA [2004] NSWCCA 92

R v Miria [2009] NSWCCA 68

R v MMK [2006] NSWCCA 272

R v Thomson & Houlton (2000) 49 NSWLR 383

R v Youkhana [2004] NSWCCA 412

SafeWork NSW v Grandcity Constructions Pty Ltd [2018] NSWDC 398

SafeWork NSW v HCM Building Pty Ltd [2019] NSWDC 632

SafeWork NSW v Poletti Corporation [2019] NSWDC 491

SafeWork NSW v Williams Timber Pty Ltd; SafeWork NSW v Easy Fall Guttering Pty Ltd [2021] NSWCCA

Veen v R (No. 2) (1988) 164 CLR 465

WorkCover Authority (NSW) v Profab Industries Pty Ltd (2000) 49 NSWLR 700

WorkCover Authority (NSW) v Sarjame Storage Pty Ltd [2015] NSWDC 151

Category:

Sentence

Parties:

SafeWork NSW (Prosecutor)
All Seasons (Aust) Gourmet Produce NSW Pty Ltd and Skevos Kakias (Defendants)

Representation:

Counsel:
Mr M Moir (for the Prosecutor)
Mr A Hallas (for the Defendants)

Solicitors:
Mr H Bell, Department of Customer Service (for the Prosecutor)
Mr H Abdallah, Koutzoumis Lawyers (for the Defendants)

File Number(s):

2020/351407 and 2020/351428

JUDGMENT

1. On 9 August 2021, All Seasons (Aust) Gourmet Produce NSW Pty Ltd (‘All Seasons’), entered a plea of guilty in respect of an offence under s 32 of the Work Health and Safety Act2011 (NSW) (‘the Act’) that it failed to comply with its health and safety duty under s 19(1) of the Act and thereby exposed Syed Mushraf Ali (‘Mr Ali’) to a risk of death or serious injury.

2. The ss 19(1)/32 of the Act offence was committed on 25 December 2018 and at that time the maximum penalty for the offence was a fine of $1,500,000.00.

3. The personal defendant, Skevos Kakias (‘Mr Kakias’) also entered a plea of guilty on 9 August 2021 to an offence that being an officer of All Seasons who had a safety duty under s 27(1) of the Act, to exercise due diligence to ensure that All Seasons complied with its duty under s 19(1) of the Act, he failed to comply with that duty and thereby exposed Mr Ali to a risk of death or serious injury contrary to s 32 of the Act.

4. The offence was committed on 25 December 2018 and at the time of the offence, the maximum penalty was a fine of $300,000.00.

5. The prosecutor tendered a Prosecution Tender Bundle which became Exhibit A.

6. The defendants read an affidavit of Skevos Kakias sworn 19 November 2021 which became Exhibit 1, and tendered a bundle of bank statements which became Exhibit 2

BACKGROUND

7. All Seasons conducted a business or undertaking that involved the wholesale supply of fruit and vegetable products to customers. All Seasons employed approximately 21 workers and operated a facility at 20–28 Carrington Rd, Marrickville (‘the site’).

8. Mr Kakias is the sole director and secretary of All Seasons. Mr Kakias has been in charge of the business from at least 2005. He worked full-time in the business and routinely attended the site and observed the work carried out by workers on an almost daily basis.

9. At 9:00 pm on 24 December 2018, Mr Ali commenced working his first shift at All Seasons at the site. He operated a Flamingo vegetable cutting machine (‘the machine’) by loading spinach onto the conveyor belt, allowing the spinach to pass through an infeed chute to two rotating blades which were used to cut the spinach. The operator of the machine could adjust the speed of the conveyor belt and the cutting blades according to the particular vegetable that was being processed through the machine.

10. Mr Ali was being supervised by Justin James (‘Mr James’) who had shown Mr Ali how to operate the machine’s controls and how to load spinach onto the conveyor belt in order to move it into the machine to be cut by the blades. However, whilst Mr James was operating the machine, he was called away to attend to a problem at another part of the site.

11. Mr Ali was left unattended at the machine. Mr James was of the understanding that the machine was not in operation, having told Mr Ali to wait for him while he was away from the machine. However, Mr Ali was in fact operating the machine without being directly supervised by Mr James or otherwise.

12. At approximately 1:39 am on 25 December 2018, some spinach on the conveyor belt became jammed at the infeed chute of the machine. Mr Ali placed his right hand inside the machine in an attempt to try and clear the blockage. As he did so, his hand became caught and pulled forward in the infeed conveyors and was forced into contact with the rotating blades.

13. As a result of the incident, Mr Ali suffered severe injury to his hand which resulted in amputation to three fingers at the first knuckle of his right hand. Mr Ali was 21 years of age at the time of the incident.

GUIDANCE MATERIAL

14. Prior to the incident, the following guidance material was available:

1. SafeWork NSW Code of Practice, Managing the risks of plant in the workplace (July 2014), which deals with guarding of machinery and outlines the guarding hierarchy. It includes guarding as a specific control measure for risks of plant, including permanently fixed physical barriers and interlocked physical barriers.

2. Australian Standard, AS 4024.1804-2014 Safety of Machinery (‘the Standard’), which provides guidance on reducing the risks to health and safety associated with machinery, including guarding design. Part 1801 of the Standard deals with safety distances to prevent danger zones being reached by upper and lower limbs. The required minimum safety distance between the infeed chute and the blades was 900mm. The actual distance between the opening of the infeed chute and the blades was 440mm.

SYSTEMS OF WORK BEFORE THE INCIDENT

15. Prior to the incident there was no guarding in place to prevent workers from using their hands to clear blockages while the machine was in operation. There was also no guarding to ensure that workers hands could not enter the machine while it was in operation, or any guarding to prevent a worker’s hands or arms from being drawn in and pulled into the machine and into contact with the blades.

16. At the time of the incident, the process in place for training new workers who were operating the machine was to be supervised while they operated the machine for a period of one or two weeks until their supervisor was confident the new employee could operate the machine on their own.

17. The system in place to clear blockages was to stop the machine, open the gate in front of the blades and put water in to clear the blockage. Mr Ali had not been provided with any information about the need to stop the machine in order to clear a blockage. He had observed Mr James pushing spinach into the machine and copied this method of work after Mr James had left him unsupervised.

18. No steps were in place to ensure Mr Ali did not operate the machine unsupervised or that he did not place his hand into the machine for any reason.

19. No risk assessment had been conducted for the operation of the machine. No documented safe work procedure or safe work method statement (‘SWMS’) had been produced or provided to Mr Ali or any other worker.

20. There was no prohibition in place on the use of the machine while it was unguarded or inadequately guarded. The machine had been operating unguarded for several years prior to the incident.

21. Mr Kakias did not directly ensure safety procedures were put in place and followed, rather he relied on the manager and supervisors to ensure safety procedures were in place to prevent injuries in the workplace.

22. Mr Kakias permitted, or alternatively did not prohibit, the operation of the machine without it being adequately guarded. He did not provide All Seasons with processes to enable it to assess the risks associated with operating the machine to develop the necessary safe work procedures.

23. The processes in place for inducting, training and supervising new workers failed to protect Mr Ali given his lack of familiarity with the systems of work during the early part of his first time working for All Seasons. Mr James had not been aware Mr Ali was due to start work on the day he started and there was no process in place for training new workers at the site before they commenced work.

SYSTEMS OF WORK AFTER THE INCIDENT

24. New guarding was placed on the machine at the infeed chute preventing workers’ hands to enter the machine and into contact with the blades. All Seasons engaged a specialist contractor to assess the safety of the machine. The contractor installed a new guard over the infeed chute which lowered the opening to a height of 80mm. This new guarding cost approximately $1,000.00.

25. Warning signage was also installed on the machine. A new safe operating procedure for operating the machine was developed by All Seasons. It drew attention to the guarding of the moving parts of the machine.

26. All Seasons developed a new system of inducting and training workers in the new safe work procedure for operating the machine. Workers were inducted into the new procedure. New or inexperienced workers were not permitted to operate any machinery at the site during their first week of employment.

SENTENCING

27. The penalty to be imposed must be one which will give overall effect to the policy of the Act, in particular, ensuring the safety, health and welfare of workers and others on workplace premises. I have had regard to the principle contained within the Act that workers should be given the highest level of protection against harm to their health, safety and welfare from hazards and risks arising from work: s 3 of the Act.

28. The Court is to be guided by the provisions of the Crimes (Sentencing Procedure) Act 1999 (NSW) (‘Sentencing Act’) which include:

1. Section 3A which sets out the purpose of sentencing;

2. Section 21A which sets out the aggravating, mitigating and other factors in sentencing; and

3. Section 22 which provides that a guilty plea is to be taken into account on sentence, as is the time when the plea was effectively indicated or entered.

29. The court is to approach a sentencing exercise on the basis of it being one of ‘instinctive synthesis’: Markarian v The Queen (2005) 228 CLR 357.

30. The approach to sentencing has been identified by Russell SC DCJ in SafeWork NSW v HCM Building Pty Ltd [2019] NSWDC 632 at [109] in this way:

‘The court must identify all the factors that are relevant to the sentence, discuss their significance and then make a value judgment as to what is the appropriate sentence given all the factors of the case: Muldrock v The Queen [2011] HCA 39; [2011] 244 CLR 120. This approach to sentencing, known as the “instinctive synthesis” approach, involves the making of a global judgement without any attempt to state precisely how any given factor has influenced the judgement.’

OBJECTIVE SERIOUSNESS OF THE OFFENCE

31. The duties of the defendants require that they ensure the health and safety of workers as far as reasonably practicable. This duty is not delegable, and the defendants had control and influence over the workers at the site. The duty requires the identification of risks in the workplace and an assessment of measures to address such risks.

32. The primary factor to be assessed is the objective seriousness of the offence. Subjective factors play a subsidiary role: Lawrenson Diecasting Pty Ltd v WorkCover Authority (NSW) (1999) 90 IR 464, 474–5.

33. The gravity of the offence is determined by the extent of the duty holder’s failure to ensure, so far as was reasonably practicable, that its workers were not exposed to risks to their safety: Orbit Drilling v The Queen (2012) 35 VR 399 at [62] (Maxwell P, Bongiorno JA and Kyrou AJA); Veen v R (No. 2) (1988) 164 CLR 465.

34. The objective degree of foreseeability is a matter for the Court to have regard to when considering the gravity of the offence: Capral Aluminium Ltd v WorkCover Authority (NSW) (2000) 49 NSWLR 610 (‘Capral Aluminium’) at [81].

35. An offence will be serious where there is an obvious or foreseeable risk to safety against which appropriate measures were not taken even though such measures were available and feasible: Morrison v Powercoal Pty Ltd (No. 3) (2005) 147 IR 117.

36. The machine had been in operation since 2014, and had never been fitted with the relevant guard. I accept that not only were blockages of the machine foreseeable, they happened regularly. Thus it was foreseeable that a worker might use their hand to clear the blockage, which could then get caught on the conveyor belt.

37. This is particularly so in circumstances where no risk assessment had been conducted for the operation of the machine whilst it was inadequately guarded, and as such there was no guarding in place that complied with the Standard to prevent workers from using their hand to clear a blockage of produce inside the danger zone whilst the machine was operating.

38. Furthermore, there was little, if any, meaningful training or supervision of employees designed to address what, to an external viewer, would be regarded as an obvious and longstanding risk of injury. There was no process for training new workers at the site, such as Mr Ali, before they were required to operate the machine. There was no system of supervision in place to prevent a new and inexperienced worker, such as Mr Ali, from attempting to clear blockages by placing their hand into the machine while it was in operation.

39. All Seasons failed to have any risk assessment conducted, or have any documented safe work procedure or SWMS for the use of the machine, or documented safe work procedure or SWMS for clearing blockages on the machine.

40. Unfortunately, the events of the night of the incident demonstrate the lack of a proper system of supervision and training of Mr Ali. The supervisor, Mr James, had been caught unawares that Mr Ali was commencing employment with All Seasons that night, and did not know that he was required to directly supervise Mr Ali for his entire shift, which was also Mr Ali’s first shift. I accept that on that evening Mr James still had his usual duties to perform (in addition to showing Mr Ali how to operate the machine), and Mr James got called away to deal with a problem on another machine when Mr Ali was injured.

41. I note that it is agreed that Mr James was of the understanding the machine was not in operation, having told Mr Ali to wait for him whilst he was away from the machine. However, Mr Ali continued to operate the machine unsupervised: Agreed Statement of Facts [12].

42. The risk of a young, untrained, unsupervised worker, on his first shift, with no relevant prior working experience, sustaining injuries when clearing the chute whilst it was operating, was glaringly obvious. The likelihood of the risk occurring was high in the absence of guarding, as the infeed chute had the moving conveyor belt and the upper roller which could easily entrap an operator’s fingers and drag them into the machine.

43. The Standard and the Code make plain the foreseeable potential consequences of the risk, including the risk of traumatic amputation of a worker’s fingers or limbs.

44. The Court of Criminal Appeal examined the sentencing process with regard to the Act in the matter of Nash v Silver City Drilling (NSW) Pty Ltd [2017] NSWCCA 96 (‘Nash v Silver City’). Justice Basten at [34], under the heading ‘Assessment of Risk’ said:

‘The sentencing judge commenced his consideration with the proposition that ‘[g]reater culpability attaches to the failure to guard against an event the occurrence of which is probable rather than an event the occurrence of which is extremely unlikely.’ However, the truth of that proposition depends upon other considerations, including (a) the potential consequences of the risk, which may be mild or catastrophic, (b) the availability of steps to lessen, minimise or remove the risk and (c) whether such steps are complex and burdensome or only mildly inconvenient. Relative culpability depends upon an assessment of all those factors.’

45. His Honour further observed at [42]:

‘The culpability of the respondent is not necessarily to be determined by the remoteness of the risk occurring, nor by a step-by-step assessment of the various elements. Culpability will turn upon an overall evaluation of various factors, which may pull in different directions. Culpability in this case is reasonably high because, even if the pressure event of the force which occurred might not be expected to occur often, the seriousness of the foreseeable resultant harm is extreme and the steps to be taken to avoid it, which were not even assessed, were straightforward and involved only minor inconvenience and a little, if any, cost. That assessment will involve both objective considerations and a consideration of what the respondent’s responsible officers knew or ought to have known.’

46. I accept that s 3A of the Sentencing Act is generally regarded as a codification of the common law principles of sentencing: R v MA [2004] NSWCCA 92. The purposes of punishment in the section are constrained by the sentencing principles that exist under the common law such as the principles of proportionality and totality: R v MMK [2006] NSWCCA 272.

47. The Court is obliged to make an assessment of where on the scale of criminality the offence lies referable to the maximum penalty prescribed by the legislature: R v Cage [2006] NSWCCA 304 at [17]–[18] (Latham J).

48. Importantly, subjective factors should not be permitted to produce a sentence which fails to adequately reflect the seriousness of the offence: WorkCover Authority (NSW) v Profab Industries Pty Ltd (2000) 49 NSWLR 700 at [31].

49. The defendants’ duty required them to identify risks at the site and to adopt measures to eliminate or minimise them: s 17 of the Act: Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at [34] (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ).

46. At the time of the incident, Mr Kakias was familiar with the operation of the machine, having originally purchased it nearly five years earlier. However, he did not have a proper understanding of the hazards associated with the use if the machine. Whilst he allowed the machine to be operated without an appropriate guard being fitted to the infeed chute, he did not provide All Seasons with the processes to enable it to fully assess the risks involved in operating the machine and to develop a safe operating procedure.

47. Employers must take steps to protect workers against risks created by inadvertent conduct of workers in the course of their work, if it is reasonably practicable to do so: SafeWork NSW v Poletti Corporation [2019] NSWDC 491 at [88].

48. The gravity of the risk is demonstrated by the seriousness of the injuries suffered by Mr Ali. As a result of the incident, Mr Ali had three fingers amputated at the first knuckle of his right hand.

49. However, I accept that it is the risk that I am assessing the seriousness of, and not the manifestation of it. At [53] in Nash v Silver City, Basten JA dealt with the proper approach to considering the objective seriousness of offences under the Act, saying:

‘It is important to note that the risk to be assessed is not the risk of the consequence, to the extent that a worker is in fact injured, but is the risk arising from failure to take reasonably practicable steps to avoid the injury occurring. To discount the seriousness of the risk by reference to the unlikelihood of the injury occurring is apt to lead to error. The conduct in question is the failure to respond to a risk of injury, conduct which will be more serious, the more serious the potential injuries, whether or not they are likely to materialise. The objective seriousness of the conduct will also be affected by the ease with which mitigation steps could have been taken.’

54. The objective seriousness of an offence under s 32 of the Act is considered in the context of the graduation of offences contained in ss 31–32 of the Act: Nash v Silver City at [54]–[56]. The matters relevant to objective seriousness for a s 32 of the Act offence include:

• The potential consequences of the risk. Consequences may range from mild to catastrophic. Offending will be more serious where the potential injuries are severe, regardless of whether they are likely to materialize: Ibid [34];

• The availability of steps to eliminate or minimise the risk: Ibid [53];

• Whether those steps are complex, burdensome or mildly inconvenient if mitigating steps could easily have been taken, the offending will be more serious: Ibid [53];

• Whether the risk was known or ought reasonably have been known to or identified by the offender;

• Whether the risk was an obvious or clear one; and

• The vulnerability of the workers exposed to the risk: SafeWork NSW v Grandcity Constructions Pty Ltd [2018] NSWDC 398 at [55] (Russell SC DCJ).

55. Where there was an obvious or foreseeable risk to safety against which appropriate measures were not taken, in circumstances where such measures were available and feasible, it will be a serious offence: WorkCover Authority (NSW) v Sarjame Storage Pty Ltd [2015] NSWDC 151 at [37] (Kearns DCJ).

56. Having regard to the seriousness of the risk and the straightforward steps that could have been taken to overcome that risk, as was in fact done after the incident, I am of the view that this offence objectively falls within the middle range of seriousness.

DETERRENCE

57. In fixing a penalty in relation to these offences, an important objective feature is the need for specific and general deterrence. This is enshrined in s 3A(b) of the Sentencing Act.

58. General deterrence is a significant factor when safety obligations are breached. The fundamental duty of the Court to ensure a level of penalty for a breach will compel attention to work health and safety issues so that persons are not exposed to risks to their health and safety at the workplace: Fisher v Samaras Industries Pty Ltd (1996) 82 IR 384 at 388 (Hungerford J).

59. When examining matters of deterrence, both specific and general deterrence apply: R v Miria [2009] NSWCCA 68.

60. The Court of Criminal Appeal in Bulga Underground Operations v Nash (2016) 93 NSWLR 338 at [177]–[180] reaffirmed the principle that both aspects of deterrence are matters which should normally be given weight of some substance in the sentencing process, unless there are exceptional circumstances which would allow a Court to depart from this rule, citing with approval the decision of the Full Bench of the Industrial Court of NSW in Capral Aluminium at [74]–[75] which said:

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

…

‘[75] … Even where an offender demonstrates good character or a commitment to rehabilitation, the court may be obliged to have regard to the need for general deterrence: see R v Thompson (1975) 11 SASR 217 at 222. This is particularly so where the offence in question is prevalent in society and represents a serious threat to the community. The need for general deterrence in relation to serious offences under the Act is undeniable.’

61. General deterrence must be a significant feature of the sentence imposed upon the defendants. It can be appropriately used to direct the industry’s attention to the consequences of inattention and the need for greater concentration on the potential risks of death or serious injury associated with working in an industry that necessitates the operation of machines containing fast moving sharp blades to chop produce, but machinery that regularly jams and needs blockages to be cleared.

62. The requirement to comply with the expectation of the community, that both large and small employers will comply with safety requirements, means that employers must take the obligations imposed by the Act very seriously. However, whilst general deterrence is a matter that I must consider in the sentencing process, it is not a factor to dominate the exercise of sentencing discretion to the exclusion of all other factors.

63. In relation to specific deterrence, the attitude of the defendants to questions of workplace safety and any steps taken to improve the safety of its worksites following a breach of a duty are relevant, as is the propensity for the defendants to reoffend. I note that the defendants continue to perform the same work as they did when the incident occurred, which requires workers to use and operate hazardous machinery.

64. I accept that the prospects of rehabilitation of the defendants are reasonably good, but the need for an element of specific deterrence is still necessary in these circumstances.

AGGRAVATING FACTORS

65. The injury, harm and loss caused by this offence was substantial: s 21A(2)(g) of the Sentencing Act. For an aggravating factor to be established, I must be satisfied beyond a reasonable doubt that the harm was greater or more deleterious than may ordinarily be expected for the offence in question: R v Youkhana [2004] NSWCCA 412 at [26]. It is not necessary that an injury occurred for the offence to be established, the creation of a risk is sufficient. In this circumstance, Mr Ali was very seriously injured during his first shift for the defendants, and I am satisfied beyond a reasonable doubt that that harm was greater than might ordinarily be expected for the offence.

MITIGATING FACTORS

66. The defendants co-operated with the SafeWork investigation: s 21A(3)(m) of the Sentencing Act.

67. The defendants entered pleas of guilty on 9 August 2021, and as such these early pleas are mitigating factors, and the defendants are entitled to a discount on the penalty for the utilitarian value of the pleas in accordance with the principles set out in R v Thomson & Houlton (2000) 49 NSWLR 383: s 21A(3)(k) of the Sentencing Act.

68. The defendants have no previous convictions: s 21A(3)(e) of the Sentencing Act. All Seasons has been in operation since 2014 and Mr Kakias has been operating the business since 2005.

69. I accept that the defendants through Mr Kakias have demonstrated contrition and remorse: s 21A(3)(i) of the Sentencing Act.

70. The defendants have implemented changes in their systems and processes, which will likely create a safer work environment. The defendants have also accepted responsibility for the failings that led to the risk to which Mr Ali was exposed, and the subsequent injury. I accept that the defendants have reasonable prospects of rehabilitation: s 21A(3)(h) of the Sentencing Act.

CAPACITY TO PAY

71. Section 6 of the Fines Act 1996 (NSW) provides as follows:

‘6   CONSIDERATION OF ACCUSED’S MEANS TO PAY

In the exercise by a court of a discretion to fix the amount of any fine, the court is required to consider:

(a) Such information regarding the means of the accused as is reasonably and practicably available to the court for consideration, and

(b) Such other matters as, in the opinion of the court, are relevant to the fixing of that amount.’

72. The onus is on the offender to satisfy the Court on the balance of probabilities as to the truth of such evidence and its relevance to the fixing of penalty: McColl v John Watson Building Services Pty Ltd (2004) 137 IR 310 at [24]. The offender’s capacity to pay is relevant but not decisive: Jahandideh v R [2014] NSWCCA 178 at [16] (Rothman J, Hoeben CJ at CL agreeing).

73. In Inspector Beacham v J & L Marble Pty Ltd [2009] NSWIRComm 100, Staff J said at [57]–[58]:

‘The principles to be applied in respect of an application under s 6 of the Fines Act were discussed by Walton J, Vice-President in WorkCover Authority of New South Wales (Inspector Farrell) v Schrader (2002) 112 IR 284 are as follows:

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

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

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

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

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

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

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

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

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

74. Annexures A and H to Exhibit 1 are the financial statements and tax returns of All Seasons covering the period from the 2018 financial year to the most recent 2021 financial year. I am satisfied that those statements demonstrate that the company remains viable and that its turnover has been generally stable since 2018. The most recent financial statement FY2021 (Annexure E) shows that the turnover of All Seasons is $6,074,113.00, which is an improvement on the previous year.

75. I accept that the documents evidence that All Seasons is paying considerable sums in wages, including those to Mr Kakias and his wife, and that the business in the most recent statement for 2021, showed a profit of $47,000.00. I also accept that the company has liabilities to its shareholder, Mr Kakias and to the ANZ Bank, presumably for the purchase of a Mitsubishi truck. I note that the company has access to credit by way of an overdraft facility.

76. The financial circumstances of Mr Kakias are described in Annexures A and I to O of Exhibit 1. Mr Kakias has, in my view, been very transparent in his affidavit as to the finances of himself, his wife and the company, but I accept that these accounts contain healthy balances and that Mr Kakias also has access to credit.

77. However, I do accept that the Covid-19 consequential lockdowns and restriction of movement would have, and may continue to have, a financial impact on All Seasons and Mr Kakias.

78. Having said that, the objective seriousness of the offence is such that it must be reflected in a significant fine. I accept that the defendant is reasonably unlikely to reoffend, but the seriousness of the offence is such that a fine must be imposed to send a message to employers that they must take their obligations to protect their workers from a risk of injury very seriously. To reduce the fine significantly would not provide the level of general deterrence that is expected, nor specific deterrence, given the risk that Mr Ali was exposed to.

79. The issuing of costs against a defendant in both criminal and civil proceedings is not punitive, but rather compensatory to the prosecution: Latoudis v Casey (1990) 170 CLR 534 at 543 (Mason CJ).

80. The Court is entitled to take into account the fact that the defendant will be liable to pay the prosecutor’s costs when considering any monetary penalty to be imposed on the defendants, particularly in circumstances where there is evidence of a limited capacity to pay a fine. Costs payable to the prosecutor are the ‘normal’ rule as the prosecutor has been successful, although there can be exceptions: see for example, Bulga Underground Operations Pty Ltd v Nash (2016) NSWLR 338.

81. In SafeWork NSW v Williams Timber Pty Ltd; SafeWork NSW v Easy Fall Guttering Pty Ltd [2021] NSWCCA at [44] and [45] Wilson JA (with whom Beech-Jones CJ at CL and Hulme JA agreed) stated as follows:

‘[44] In the ordinary course, it is open to sentencing judges to act on the basis of an agreement between the prosecutor and the defendant concerning costs, and then consider what impact the award of costs may have on the means of a defendant to pay a fine under s 6 of the Fines Act. It is noted that a sentencing court is required to consider information regarding the means of a defendant when exercising the discretion to fix the amount of a fine; it is not necessary for a defendant to make an application to the court to consider means when assessing the amount of a monetary penalty.

[45]   In sentencing Williams Timber, and in sentencing Easy Fall, her Honour was in error in treating a costs order as a form of punishment, and using the refusal to make an order as a means of ameliorating penalty. Such amelioration as was held to be necessary after considering the means of each defendant should have been delivered by mitigation of the fine.’

82. The Court can also have regard to the defendant’s own costs that it will have to bear as a consequence of a breach of the Act, and I have done so: Environmental Protection Authority v Barnes [2006] NSWCCA 246 at [78].

83. After the conclusion of the sentence hearing, I invited the prosecutor and the defendants to provide written submissions with regard to the capacity of the defendants to pay a fine.

84. Both Counsel provided detailed and helpful written submissions.

85. It is clear that as the payment of the prosecutions costs is not punitive, I must consider the defendants’ obligation to pay such costs by these orders, as well as their own costs in the context of allowing any leniency to be applied to the fines imposed, which I have done.

86. The appropriate fine for All Seasons is $150,000.00, and it is entitled to a discount of 25% for the early plea.

87. The appropriate fine for Mr Kakias is $50,000.00 and he is entitled to a discount of 25% for the early plea.

PENALTY

88. I make the following orders:

1. The defendant, All Seasons (Aust) Gourmet Produce Pty Ltd, is convicted.

2. The appropriate fine is $150,000.00 and the defendant is entitled to a discount of 25% for the early plea.

3. Accordingly, I order the defendant, All Seasons (Aust) Gourmet Produce Pty Ltd, pay a fine of $112,500.00.

4. The defendant, Skevos Kakias, is convicted.

5. The appropriate fine is $50,000.00 and the defendant is entitled to a discount of 25% for the early plea.

6. Accordingly, I order the defendant, Skevos Kakias, pay a fine of $37,500.00.

7. Under s 122(2) of the Fines Act 1996 (NSW) a moiety of the fines imposed be paid to SafeWork NSW.

8. All Seasons (Aust) Gourmet Produce NSW Pty Ltd and Skevos Kakias to pay the prosecutor’s costs as agreed or assessed.

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Decision last updated: 11 February 2022