SafeWork NSW v Casella

[2023] NSWDC 503

District Court

New South Wales

Medium Neutral Citation:

SafeWork NSW v Casella [2023] NSWDC 503

Hearing dates:

13 November 2023

Date of orders:

20 November 2023

Decision date:

20 November 2023

Jurisdiction:

Criminal

Before:

Scotting DCJ

Decision:

1   Sam Casella is convicted.

2   I impose a fine of $120,000.

3 I order pursuant to section 122(2) Fines Act 1996 that 50% of the fine is to be paid to the prosecutor.

4   The offender is to pay the prosecutor’s costs of the proceedings as agreed or assessed.

Catchwords:

CRIMINAL LAW – prosecution – work health and safety – duty of persons undertaking business – duty of employers – risk of death or serious injury – injury to worker

SENTENCING - objective seriousness - deterrence - aggravating factors - mitigating factors – capacity to pay a fine - appropriate penalty

SENTENCING PRINCIPLES - no record of previous convictions - good prospects of rehabilitation - remorse - plea of guilty - assistance to law enforcement authorities

Legislation Cited:

Crimes (Sentencing Procedure) Act 1999

Work Health and Safety Act 2011 (NSW)

Cases Cited:

Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37

Jahandideh v R [2014] NSWCCA 178

R v Borkowski (2009) 195 A Crim R 1

R v Thomson & Houlton (2000) 49 NSWLR 383

R v Youkhana [2004] NSWCCA 412

Category:

Sentence

Parties:

SafeWork NSW (Prosecutor)
Sam Casella (Defendant)

Representation:

Counsel:
A Mykkeltvedt (Prosecutor)
P Bolster (Defendant)

Solicitors:
Legal, Department of Customer Service (Prosecutor)
MPM Legal (Defendant)

File Number(s):

2023/32560

Publication restriction:

None

JUDGMENT

Introduction

1. Sam Casella (the offender) appears for sentence after pleading guilty to an offence under s 32 of the Work Health and Safety Act 2011 (NSW) (the Act), in that he failed to comply with the health and safety duty he owed pursuant to s 27 of the Act and thereby exposed Samuel Tembeleski to a risk of death or serious injury.

2. The maximum penalty for the offence is a fine of $353,430.

Facts

Background

3. Combeda Constructions Pty Ltd (Combeda) was the principal contractor for the development of a mixed use residential and commercial complex in Shellharbour (the site). Nicsons Concrete Pty Ltd (Nicsons) was a subcontractor for concrete and formwork on the site, which subcontracted Quattro Constructions Pty Ltd (Quattro) to supply and install formwork at the site.

4. The offender was the sole director and secretary of Quattro. Mr Tembeleski was 19 years old and employed by Quattro as an apprentice. He was assigned to work at the site and had been working there for a few months prior to the incident. At the time of the incident, he was a third-year apprentice and had completed a TAFE course in Formwork. He was not subject to any supervision at the time of the incident.

5. The site comprised one building with a carpark/basement and a ground, first and second floor. The carpark/basement had a solid concrete floor.

6. As at 1 February 2021, there was a penetration in the structure designed for electrical, water and air-conditioning services (the penetration). The penetration was 500mm in width and 2000mm in length. It ran from level 2 through to the concrete basement floor.

7. On 27 January 2021, SafeWork Inspector Stephen Cooper conducted a proactive visit at the site with a focus on electrical safety. During that inspection, Inspector Cooper identified a fall hazard relating to the leading edges of the formwork deck. While on site, Inspector Cooper asked to see a copy of the formwork Safe Work Methods Statement (SWMS). He was advised that they were unable to locate a copy of the SWMS.

8. At 6:37pm, Inspector Cooper sent an email to Combeda attaching a number of improvement notices, including the following:

1. notice ending 308, which noted that there were no adequate systems to prevent a person falling;

2. notice ending 328, which noted that workers were at risk as there was no handover certification for internal scaffolding in the lift shafts, and which required Combeda to ensure that all scaffolding for fall control had been inspected and written verification had been received from a competent person that the scaffolding was in a safe condition to use; and

3. notice ending 329, which noted that Combeda had not ensured that arrangements were in place to ensure that work from heights above 2 metres was carried out in a safe manner and in accordance with the formwork SWMS, to ensure that arrangements were in place to monitor compliance with the formwork SWMS, and to stop work immediately when work is not carried out in accordance with the SWMS.

9. At the time of the inspection, there was no edge protection in place to prevent access to the penetration.

10. At some point between 27 January 2021 and 30 January 2021, Anh Dang directed workers to strip the formwork underneath the penetration where Mr Tembeleski ultimately fell. Mr Dang did not tell Mr Tembeleski that the formwork had been stripped.

The incident

11. At approximately 7:00am on 1 February 2021, Mr Tembeleski arrived at the site. He then left the site to buy a pair of boots, returning at about 7:25am and starting work at about 7:30am.

12. Mr Dang instructed Mr Tembeleski to drill holes in the Dincel formwork wall panels on level 2 of the site. Mr Tembeleski collected the tools required for the work, including electrical leads and a drill. Mr Tembeleski then went to the location of the Dincel panels, which were adjacent to the penetration. The penetration was covered by a piece of plywood, which was not embedded into the concrete or otherwise structurally supported. It was not marked to indicate that it was covering the penetration, nor was there any signage to alert workers to the penetration. Mr Tembeleski claims that there was no handrail at the time of his fall. John Mamone, Combeda’s site foreman, claims that the handrail was present when he went to inspect the area from which Mr Tembeleski fell following the incident.

13. Mr Tembeleski set up to perform the task. As he stepped onto the plywood, it gave way and he fell to the basement floor, which was approximately 12m below. He cried out for assistance and attempted to use his phone to call his brother, Mr Dang and “000”.

14. At 7:39am, Emrah Yilmaz, an electrician, signed onto the site. He heard a person yelling for help and ran down to the basement level, finding Mr Tembeleski lying on the ground.

15. Emergency services were called at 7:41am and an ambulance arrived at 7:47am.

16. Mr Tembeleski was taken by ambulance to St George Hospital. He sustained multiple pelvic, lumbar and limb fractures, including the following:    

1. comminuted fracture left T5 transverse process, left sacral fracture, left acetabulum fracture and left inferior pubic rami fracture with pubic diastasis;

2. sternal fracture;

3. left distal tibia, medial malleolus and talar fractures;

4. closed left ankle fracture/dislocation; and

5. left elbow dislocation.

17. He also sustained pulmonary contusions, a tear in the descending aorta with an associated haematoma, extraperitoneal and intraperitoneal haematoma and right adrenal haematoma. He underwent surgery for his injuries and was discharged from hospital on 25 February 2021.

18. When SafeWork inspectors arrived at the site that same day, there was a steel handrail approximately 900mm in height, secured by bolts to the floor in front of the penetration. The handrail did not have a mid or toe rail. There was a gap of approximately 300mm from the Dincel panel wall to the handrail on the eastern side.

Systems of work prior to the incident

19. Prior to the incident, Combeda had a Site Specific Safety Plan which included Site Safety Rules requiring handrails to be installed in a place where a person could fall more than 1.5m. Combeda required all workers to complete a Site Specific Induction which included the Site Safety Rules. Combeda required sub-contractors to provide SWMS. It conducted toolbox talks (TBT) with its workers.

20. Inspector Cooper asked to see a copy of the formwork SWMS when he attended the site on 27 January 2021.

21. At 5pm on 27 January 2021, Inspector Cooper was informed by Anthony Cavallaro, director of Combeda, that a SWMS and TBT would be completed the next morning.

22. Quattro provided a SWMS for Formwork Stripping that was on a letterhead for VPT Formwork (NSW) Pty Ltd (VPT SWMS). The document was prepared by Andre Tembeleski and signed by Quattro workers, including Samuel Tembeleski, on 28 January 2021. Andre Tembeleski claimed that he was told by Nicola Barbieri to backdate the SWMS that was sent to the worksite. The VPT SWMS included a requirement that any trip or fall hazards be eliminated, that penetrations be covered and secured, and that handrails be installed where necessary.

23. The VPT SWMS did not provide specific guidance as to the means by which plywood covers were to be secured, specify the type of handrails to be used, require that the handrails had to include a top, middle and bottom rail, require plywood penetrations to be appropriately marked, or require that warning signs be used to identify the presence of a penetration.

24. The offender had limited day-to-day involvement in the operation of Quattro’s business. He did not exercise due diligence to ensure that Quattro complied with its duty or obligations under s 19(1) of the WHS Act, in the following ways:

1. he had asked Mr Barbieri general questions about the work, but did not take steps to specifically inform himself as to the potential hazards and risks at the site or any other workplace health and safety issues;

2. he did not require Quattro personnel to provide him with information in relation to risks that may arise at the site or the safe work procedures it had implemented to address such risks;

3. he did not require Quattro to develop a SWMS in relation to the formwork;

4. he did not discuss the VPT SWMS with Mr Barbieri or other personnel and did not independently review the SWMS;

5. he did not ensure that they had been reviewed by an appropriately qualified person;

6. he did not conduct or direct any of Quattro’s personnel to conduct appropriate risk assessments in relation to the task of formwork stripping, nor did he undertake inquiries in relation to the adequacy of the supervision arrangements in place in relation to the performance of formworks; and

7. he did not take steps to verify that Quattro had sufficient resources to implement the VPT SWMS.

Systems of work after the incident

25. An improvement notice was issued to Combeda on 1 February 2021 by SafeWork NSW. It directed Combeda to eliminate the risk of falls through penetrations and, where elimination is not possible, maintain a safe system of work which complies with cl. 79 of the WHS Regulation 2017. In response, Combeda installed further handrails, including a mid-rail and toe board at the location of the penetration, and closed the gap between the handrail and the Dincel wall on the eastern side of the penetration. It also engaged a scaffolding company to review all edge protection around the site.

Offender’s Case on Sentence

26. The offender relied on an affidavit sworn by him on 9 November 2023 and took me to a number of the documents in the Prosecution Tender Bundle (PTB) to explain his involvement in the operation of Quattro.

27. Dealing with the second matter first, the documents in the PTB establish a factual basis for the following matters.

28. Quattro was one of a group of companies operated by Peter Milazzo, which included VPT Formwork (NSW) Pty Ltd (VPT), of which Mr Milazzo was a director. Quattro operated as a labour hire company to VPT, which had contracts to perform formwork on significant constructions. The group had operated for about 10 years in this structure, using a number of different companies. All of the workers engaged to undertake formwork on behalf of VPT or related companies, were employed by Quattro from about August 2020.

29. There were a number of workers undertaking formwork at the site at the time of the incident who were employed by Quattro. Quattro had a turnover in the financial year 2021 of about $3.2 million.

30. Nicola Barbieri contracted to VPT to conduct and supervise its operations and reported to Mr Milazzo. Mr Barbieri directed Andre Tembeleski to back date the version of the VPT SWMS sent to SafeWork NSW after the incident.

31. Mr Milazzo controlled the bank accounts of VPT and Quattro.

32. Anh Dang was the site supervisor of Quattro, who reported to Mr Barbieri.

33. The offender was employed as a truck driver or a yard manager at VPT’s yard in Silverwater. The offender is Mr Milazzo’s cousin. According to Andre Tembeleski, the offender had “zero involvement” with running Quattro.

34. Mr Milazzo has a history of registering new companies and transferring the workers. Cassaforma Constructions Pty Ltd was another such company.

35. The offender’s affidavit can be summarised as follows.

36. He is 47 years old.

37. He is currently employed by Grandfield 100 Pty Ltd, which is a formwork company. He has been employed there for about three months. His responsibilities include driving a truck and looking after the yard. He delivers material to various job sites as and when needed. He reports to the construction manager.

38. He was previously employed by Cassaforma Constructions Pty Ltd and performed the same work.

39. He annexed his payslips from his current employer. He is paid approximately $1000 per week, after tax and child support payments. He does not receive any other income.

40. He currently pays $180 per week in child support for his two daughters, who are 14 and 16 years of age. He also has accrued liability for child support, for which he is required to pay an additional $100 per week.

41. He lives with his parents in their home. He pays $400 per fortnight in board.

42. He owns land in Bossley Park, which he purchased for $350,000 in 2004. In 2018, he purchased his wife’s share for $150,000 as part of a Family Court settlement. He paid for this with funds lent by Peter Milazzo. The offender is currently indebted to Mr Milazzo in the sum of $960,000 in respect of that settlement and the costs for construction of the building on that land, which is incomplete. The offender expects that it will cost an additional $300,000 to complete construction of the building, which he is unable to afford.

43. After the incident, the offender spoke regularly to Andre Tembeleski, to ascertain how Samuel Tembeleski was after the incident.

44. The offender expressed that he was very sorry that Samuel Tembeleski suffered the injuries that he did. He expressed regret that he was unable to prevent the incident from occurring.

Consideration

45. I have had regard to the objects of the Act set out in s 3 and the purposes of sentencing set out in section 3A Crimes (Sentencing Procedure) Act 1999.

Objective Seriousness

46. The risk was obvious and well known, both to the offender and in the industry. There was ample guidance material available to inform the offender of the risk and the control measures that he should have facilitated for Quattro to take.

47. The steps that could have been taken to control the risk were simple and inexpensive and the amount of due diligence required to be exercised by the offender to ensure that Quattro was complying with its s 19(1) duty was low.

48. The offender agreed that his failures were extensive. The offender was the appointed director of Quattro who took no part in its management, or the operation of its business. The offender has not explained how he came to be appointed as the sole director and secretary of Quattro. As an employee of Quattro who worked at the yard from where it operated its business, I am satisfied that he knew that it provided formwork services and that the size of the business was significant. In his position as director, the offender took no steps to ensure that Quattro complied with its s 19(1) duty other than, as agreed in the facts, to ask Mr Barbieri some general questions about the work.

49. The Act imposes health and safety duties on persons conducting a business or undertaking (PCBUs) which can include corporations. The s 27 duty imposes obligations on officers, as individuals, to exercise due diligence to ensure that a corporation complies with its health and safety duty by taking reasonable steps to control risks to health and safety. The s 27 duty is an important mechanism required to achieve the objects of the Act. By acting as a director of Quattro in name only, the offender failed to take reasonable steps to ensure that it was complying with its health and safety duty, including by implementing a SWMS for the site and making sure that the SWMS adequately controlled the risks to Quattro’s workers on the site. The offender played an important role in subverting the policy underlying the Act, notwithstanding that his role was one at the lower end of the hierarchy. I am unable to make any finding on what, if any, benefit the offender received for agreeing to the appointment as a director of Quattro. I accept that he did not have as much to gain from the arrangement as others did.

50. By agreeing to be a director of Quattro, the offender voluntarily accepted the legal obligations that went with that position (which were not limited to the s 27 duty). He then failed to comply with his s 27 duty, because it was never contemplated by the arrangement that he would do so.

51. The likelihood of the risk coming home was moderate to high because adequate precautions were not taken.

52. The risk included a risk of death of one or more workers.

53. Mr Tembeleski was an apprentice worker who was vulnerable by reason of his lack of experience and that he was working without supervision prior to the incident. The injuries sustained by Mr Tembeleski were very serious and he was lucky to survive the fall.

54. I have taken into account the maximum penalty for the offence.

Deterrence

55. The penalty imposed in relation to this offence must provide for general deterrence. Officers of corporate PCBUs must take the obligations imposed by the Act very seriously. The community is entitled to expect that both small and large PCBUs will comply with safety requirements. General deterrence is a significant factor when safety obligations are breached: Bulga Underground Operations Pty Ltd v Nash [2016] NSWCCA 37 at [180].

56. Further, this case represents a deliberate attempt to avoid important health and safety duties imposed by the Act and this conduct must be discouraged in the strongest possible terms by refence to the penalty imposed for this offence.

57. There is some need for specific deterrence because the offender demonstrates little insight into his obligations as an officer of Quattro. His failures to exercise due diligence were substantial. Conversely, Quattro is in liquidation and he is no longer a director of a company undertaking a construction business.

Aggravating factors

58. The injury, harm and loss caused by the section 32 offence was substantial: section 21A(2)(g) Crimes (Sentencing Procedure) Act 1999. In order for the aggravating factor to be established, I must be satisfied beyond 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]. The offence does not require an injury to be sustained but only the creation of a risk. The injuries sustained were serious and sufficient to establish the aggravating factor.

Mitigating factors

59. The offender does not have a record of previous convictions: s 21A(3)(e) Crimes (Sentencing Procedure) Act 1999. The offender is presently 47 years of age.

60. The offender was a person of good character: s 21A(3)(f) Crimes (Sentencing Procedure) Act 1999. The offender comes before the Court without any prior convictions at the age of 47 and is entitled to be considered to be a person of good character.

61. The offender has some prospects of rehabilitation, but I am not satisfied that the mitigating factor provided for by s 21A(3)(h) Crimes (Sentencing Procedure) Act 1999 is established. The offender has accepted some responsibility by pleading guilty to the offence and facilitating the course of justice, but he has not demonstrated any change in attitude to safety, mainly because he was used as a stooge. He has not sought to explain how he got involved and still works for a company controlled by Mr Milazzo.

59. The offender has expressed his sorrow for the injuries sustained by Mr Tembeleski and has sought to enquire as to his welfare. He has expressed a wish that he could have done something to prevent the incident. This latter sentiment exposes a lack of insight into his duty as an officer of Quattro and fails to take responsibility for the failings that led to the incident. I am not satisfied that the mitigating factor provided for by section 21A(3)(i) Crimes (Sentencing Procedure) Act 1999 has been established.

60. The offender entered a plea of guilty: section 21A(3)(k) and section 22 Crimes (Sentencing Procedure) Act 1999. He is entitled to a discount on penalty that reflects the utilitarian value of that plea: R v Thomson & Houlton (2000) 49 NSWLR 383 and R v Borkowski (2009) 195 A Crim R 1 at [32]. The plea also indicates remorse: Borkowski at [32]. The prosecutor submitted that the delay in agreeing the facts to put before the Court should be taken into account in this assessing the quantum of the discount. I am satisfied that the offender has found himself in a difficult position in these proceedings and that the breaks in communication with the prosecution have not in the end diminished the utilitarian value of the plea. The appropriate discount is 25%.

61. I accept that others may also have engaged in culpable conduct in the lead up to Mr Tembeleski’s injury, however I do not find that mitigating of this offence. I am dealing in this sentence with the culpability of the offender for a breach of the s 27 duty. There were clearly a number of other “officers” of Quattro as defined by s 9 Corporations Act 2001, who could properly be considered as co-offenders for parity purposes, but to date none of those individuals have been prosecuted.

Capacity to pay a fine

65. The Court is required to have regard to s 6 Fines Act 1996 before imposing a fine. Where an offender seeks to have a fine reduced on the basis of a limited capacity to pay, he or she bears the evidentiary onus of convincing the Court that it should exercise its discretion to limit the amount of the fine. The offender’s capacity to pay is relevant but not decisive: Jahandideh v R [2014] NSWCCA 178 at [16]. A substantial fine may still be warranted as a result of the seriousness of the offence and the need for general deterrence.

66. The offender works as an employee and earns about $38,000 per annum. He has some debts and regular commitments, including child support. He owns a property that, on his assertion of indebtedness to Mr Milazzo, has very little equity left in it. There is limited evidence, albeit that it was unchallenged. I have significant reservations about accepting any evidence of the indebtedness to Mr Milazzo, without any documentary evidence to support the assertion. I am not satisfied that the offender has demonstrated a limited capacity to pay a fine.

67. If I am wrong on this point, I would not exercise my discretion to reduce the fine on the basis of limited capacity to pay. This is a serious case. The offender took almost no steps to comply with the s 27 duty. He has not sought to explain how he became involved as a director of a company undertaking a large business that regularly exposed workers to hazards, without taking appropriate measures to control the risks involved. The penalty imposed must signal to other officers who do not intend to comply with their obligations that they will be met with significant punishment.

Penalty

68. Sam Casella is convicted.

69. I have taken into account the Victim Impact Statement prepared by Mr Tembeleski.

70. The appropriate fine is one of $160,000 which I will reduce by 25% to reflect the discount for the plea of guilty.

71. I impose a fine of $120,000.

72. I order pursuant to s 122(2) Fines Act 1996 that 50% of the fine is to be paid to the prosecutor.

73. The offender is to pay the prosecutor’s costs of the proceedings as agreed or assessed.

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Decision last updated: 20 November 2023