SafeWork NSW v CPB Contractors Pty Limited

[2021] NSWDC 376

District Court

New South Wales

Medium Neutral Citation:

SafeWork NSW v CPB Contractors Pty Limited [2021] NSWDC 376

Hearing dates:

23 July 2021

Date of orders:

3 August 2021

Decision date:

03 August 2021

Jurisdiction:

Criminal

Before:

Scotting DCJ

Decision:

1   CPB Contractors Pty Ltd is convicted.

2   I impose a fine of $85,000.

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

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

Catchwords:

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

SENTENCING - objective seriousness - deterrence - aggravating factors - mitigating factors – appropriate penalty

SENTENCING PRINCIPLES - record of previous convictions under former legislation - 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

Work Health and Safety Regulation 2017

Cases Cited:

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

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)
CPB Contractors Pty Limited (Defendant)

Representation:

Counsel: C Magee (Prosecutor)
J Fernon SC (Defendant)

Solicitors: Legal, Department of Customer Service (Prosecutor)
Herbert Smith Freehills (Defendant)

File Number(s):

2020/3900

Publication restriction:

None

Judgment

1. CPB Contractors Pty Limited (the offender) appears for sentence after it pleaded guilty to an offence pursuant to s 32 Work Health and Safety Act 2011 (the Act) in that it failed to comply with the health and safety duty it owed pursuant to s 19(1) of the Act and thereby exposed Kenneth Manning to a risk of death or serious injury.

2. The maximum penalty for the offence is a fine of $1.5 million.

Facts

3. The parties tendered an Agreed Statement of Facts that can be summarised as follows.

4. The offender was previously known as Leighton Contractors Pty Limited. It is part of the CIMIC Group Limited (formerly known as Leighton Holdings Limited) and is listed on the Australian Stock Exchange. The CIMIC Group undertakes projects in construction, mining, services, infrastructure and resources sectors.

5. On or about 19 May 2016 the offender entered into a Joint Venture with John Holland Pty Ltd (John Holland) and Samsung C & T Corporation (Samsung) for the design and construction of the WestConnex M4 East Project (Joint Venture). The offender, John Holland and Samsung were equal partners in the performance and completion of the design and construct contract for the WestConnex M4 East Project (the Project). The offender was appointed as Principal Contractor for the project.

6. The Joint Venture engaged Lawson Civil and Construction Pty Ltd (Lawson) on 18 October 2017 to act as tunnel supervisor. Aaron Lawson, an employee of Lawson, was acting as tunnel supervisor on the day of the incident.

7. The Joint Venture contracted MGW Engineering Pty Limited trading as Forefront Service (Forefront) for the installation of high density polyethylene (HDPE) conduits and pipes including the installation of and pressure testing of the components of the fire and deluge system for the Project. Julian Stambe of Lion Services Pty Ltd was contracted by Forefront to the Project. Mr Stambe had previously been an employee of Forefront for three years and had been contracting to it for approximately three months. At the time of the incident, Mr Stambe was the onsite supervisor and co-ordinator who also performed installation and testing of the services.

8. The Joint Venture engaged Kenny Constructions (Aust) Pty Ltd (Kenny Constructions) to provide all formwork, steel reinforcement and pouring of concrete for permanent based slabs, suspended roof slabs and block works associated with the cross passages (XP) XP23 to XP44 and sub-station 7 of the Project. Mr Manning was employed by Kenny Constructions as a formwork carpenter and had held that position for about two years prior to the incident. Jani Komulainen of Komform Pty Ltd was contracted by Kenny Constructions to provide supervisory services at the site. Mr Komulainen had been undertaking that contract work for about two years and three months prior to the incident.

The Incident

9. On 1 February 2018 there was an uncontrolled release of pressurised water from a fire and deluge main riser pipe located in XP25. The incident caused serious injury to Mr Manning. Mr Manning was unbolting a clamp or coupling that he believed connected a spool pipe to the fire and deluge main pipe riser. The coupling contained a blank cap that sealed the fire and deluge main pipe riser creating a closed pipe system. The fire and deluge main rise pipe had been the subject of hydrostatic water pressure testing the evening before the incident and was still under pressure. Mr Manning was struck by high pressure water due to the uncontrolled release of the stored water energy, approximately 1600 kPa, when he unbolted the coupling that had been sealing the fire and deluge main pipe riser.

10. Mr Manning sustained multiple left sided rib fractures, a small lung laceration medially in the left lung, a grade 2 liver laceration and a probable grade 1 splenic laceration.

The Site

11. The Project was the extension of the M4 Motorway in Sydney in tunnels between Homebush and Haberfield via Concord. It included two new three- lane tunnels, one east bound and one west bound, extending from the west of Pomeroy Street at Homebush to Parramatta Road, Wattle Street/City West Link Haberfield. The incident took place at XP25 which was within the “Cintra Park Concord” to “Northcote Street, Haberfield” section of the Project.

12. An XP is a short tunnel that connects two parallel tunnels which provide cross ventilation and access for vehicle and plant movement between tunnels during the construction phase. XPs in the mainline tunnel were typically spaced at 120 metre intervals with an emergency egress room typically located in every XP in the main line.

13. There were three general arrangements for mainline XPs from XP23 through to XP44, being:

1. Non-Electrical Equipment Room Cross Passage (non-EER);

2. Electrical Equipment Room Cross Passage (EER);

3. Vehicle Cross Passage (VXP).

14. The cross passages were installed with electricity, water and drainage services. XP25 was a non-EER cross passage.

15. XP25 was approximately 8 metres long x 8 metres wide. On each side of the passage along the inner wall of the adjacent tunnels, a fire and deluge water drainage pipe was laid. At the entrance to each site of the passage, a 300 mm diameter pipe (T-joint) ascended from each drainage pipe to around 1 metre above ground level. An elbow joint of similar diameter was coupled to each T-joint. The T-joint and the elbow joint formed the riser pipes.

16. A 250 mm diameter steel fixing or blank cap was retained within a 300 mm steel clamp or coupling that was bolted to each pipe riser. The blank cap sealed the riser, creating a closed pipe system.

17. A temporary spool pipe was situated between each risers’ blank cap. The spool spanned the full width of the passage, positioned to ensure the fire deluge water pipes on each side of the passage were kept accurately separated during the construction work.

18. Prior to the incident, the Joint Venture provided information and documents to Forefront and Kenny Constructions and their respective workers, including:

1. project and tunnel inductions;

2. daily pre-start briefings;

3. Work Packs outlining high level project specific information, including activity scope, location and task information for the Project.

19. Prior to the incident the Joint Venture provided Forefront with a Safe Work Method Statement (SWMS).

20. The contract between the Joint Venture and Kenny Constructions outlined the scope of work to be delivered by Kenny Constructions in relation to the fit out of each XP. The Joint Venture had prepared a “WestConnex Work Pack Tunnel Cross Passage Fit Out” (Work Pack – Fit Out) dated 9 November 2017 for cross passage tunnel fit outs.

21. The Work Pack – Fit Out set out high level project specific information including activity scope, location and task information in respect of the XP fit out for the XPs built from XP23 to XP44. The Work Pack – Fit Out was applicable to the work being undertaken by Kenny Constructions at the site. The Work Pack – Fit Out did not include in the activity scope any work method or sequence for the removal of pipes. The Work Pack – Fit Out identified the interface risk arising from work performed on or near energised electrical installations or services, but did not specifically describe that interface risk as including pressure testing and/or hydrostatic pressure testing. At the time of the incident, the SWMS that Kenny Constructions was operating under in respect to the formwork in the location between Northcote Street and Cintra Park was, “FRP to various elements including scaffold works – SWMS dated 24 November 2017” (SWMS-FRP).

22. At the time of the incident the SWMS-FRP identified the interface risk arising from work performed with live services, but did not specifically describe that interface risk as including pressure testing and/or hydrostatic pressure testing.

23. The contract between the Joint Venture and Forefront outlined the scope of work to be delivered by Forefront in relation to services installation. Annexure “C” of the contract between the Joint Venture and Forefront required testing of the installations.

24. The Joint Venture had prepared a “WestConnex Work Pack Tunnel Drainage and Services Installation 24 October 2017” (Work Pack – Services Installation) for the installation of the tunnel drainage and services.

25. The Work Pack – Services Installation was applicable to the work being undertaken by Forefront at the site. It outlined the activity scope, location and work method and sequencing and provided a step-by-step detail of how each task for the tunnel drainage and services installation, including the fire and deluge services, was to be completed. The scope of work included testing of the installations. It provided that where possible, testing of pipes for the fire and deluge system was to be undertaken prior to back fill. The Work Pack – Services Installation identified work on or near energised electrical installations or services as high risk construction work within the Work Pack and identified the applicable SWMS to apply to that work. In addition, the Work Pack referred to the requirement for pressure testing, however, did not include steps and procedures required for the hydrostatic pressure testing of the fire and deluge system.

26. In consultation with Forefront, the Joint Venture had prepared a “WestConnex SWMS Service Installation Works dated 30 October 2017” (SWMS – Services).

27. The SWMS – Services was the SWMS for tunnel service installations for the work location at Northcote Street being undertaken by Forefront. The SWMS – Services identified the pressure testing of HDPE pipes as a high risk construction work activity and that the associated hazard was an uncontrolled release of energy. The control measures described in the SWMS – Services included:

1. ensure all exclusion zones are in place prior to testing and that barriers and/or spotters are in place;

2. ensure a pressure testing plan and check list is in place and adhered to;

3. at the completion of testing, ensure any stored energy is released in a controlled manner.

28. The risk of working with live services was identified as high risk construction work in the SWMS Services.

29. On 31 January 2018 Mr Stambe performed a hydrostatic pressure test of the HDPE fire and deluge main that Forefront had installed in the west bound main line tunnel between XP25 and XP29. At about 2pm on 31 January 2018, Mr Stambe filled the west side deluge water HDPE pipe with water and commenced a hydrostatic pressure test to identify any leakage along the 600 metre length pipe which intersected at XP25 and included the pipe risers located in XP 25. Craig Currey, a plumber of Forefront, was with Mr Stambe when he undertook the hydrostatic pressure test. Mr Stambe stated that it took approximately four hours for the water pressure to build to approximately 2350 kPa in the west side deluge water HDPE pipe. Pressure testing that had previously been undertaken at other locations within the Project had taken approximately half an hour.

30. Without notification to the offender, Mr Stambe decided to continue the hydrostatic pressure test overnight and left the pipe at a pressurised state and unsupervised at the end of the test. The decision to leave the pipe in a pressurised state was contrary to the requirement of the SWMS to “ensure any stored energy was released in a controlled manner” at the completion of testing.

31. Mr Stambe requested Chris Bourke, who was undertaking night shift for Forefront, to continue to test and check for any leaks. Mr Stambe did not document the handover he provided to Mr Bourke on 31 January 2018 relating to the continuation of the pressure testing of the west side deluge water HDPE pipe.

32. On 1 February 2018 at approximately 4.45am, Mr Lawson conducted the Joint Venture pre-start briefing. Mr Stambe, Mr Komulainen and Mr Manning attended this briefing and signed the attendance sheet. The pre-start briefing was documented and listed planned activities for the shift including:

1. work on XP25 to XP29;

2. Forefront installing HDPE/conduits;

3. reo, fix and pour.

33. Mr Lawson stated that the status of the hydrostatic pressure test performed on the west side deluge water HDPE pipe on 31 January 2018 was discussed by Mr Stambe and Mr Komulainen at the Joint Venture pre-start on 1 February 2018. Mr Manning could not recall if there was any discussion of the hydrostatic pressure test performed on 31 January 2018 at the pre-start meeting.

34. Mr Stambe and Mr Komulainen stated they had discussions with Mr Lawson after the pre-start meeting at approximately 6.15am. Mr Stambe stated that he informed Mr Komulainen and Mr Lawson that the hydrostatic pressure test performed on 31 January 2018 was completed but that the pipe was still under pressure. Mr Komulainen stated that the conversation on 1 February 2018 was only in relation to XP28 and that he was informed by Mr Stambe that testing had been completed at 4am.

35. Mr Lawson stated that the conversation about the hydrostatic pressure test occurred during the pre-start meeting. Mr Lawson stated that Mr Stambe had informed them that the pipe was still under pressure and the test was ongoing. Mr Lawson stated that the pre-start document for 1 February 2018 was prepared by him before the conversation with Mr Stambe and Mr Komulainen.

36. The offender’s position was that at 6.30am on 1 February 2018, Mr Komulainen requested a status update on the pressure testing from Mr Stambe and Mr Lawson and that Mr Stambe informed Mr Komulainen that the pressure test was complete.

37. At about 7.15am Mr Komulainen conducted the Kenny Constructions pre-start briefing. Mr Manning attended this meeting and signed the attendance sheet. The Kenny Constructions pre-start briefing was documented and listed the day’s work activities including:

1. XP25 floor pour;

2. install services – main line.

38. At the Kenny Constructions pre-start meeting, Mr Komulainen advised Kenny Constructions’ workers that the pressure test was completed and that workers should continue works as planned for the day starting with the concrete pour in XP28.

39. After the Kenny Constructions pre-start meeting, the workers including Mr Manning, prepared XP28 for an apron slab concrete pour. The workers, including Mr Manning, then moved to XP25 to undertake the installation of steel reinforcement mesh in preparation for a concrete slab pour. The temporary spool pipe that was situated between each risers’ blank cap and XP25 created an obstacle for the Kenny Constructions’ workers in undertaking the concrete slab pour. The spool spanned the full width of the passage where the concrete was to be poured.

40. A decision was made to remove the temporary spool pipe that was situated between each risers’ blank cap at XP25 to enable the Kenny Constructions crew to prepare for the concrete slab pour.

41. In order to remove the temporary spool pipe at XP25 the workers positioned slings evenly along the spool so that it could be lifted from its position and held up by a piece of mobile plant. Mr Manning proceeded to remove the Victaulic coupling from inside the riser in order to disconnect the spool from the riser. Mr Manning stated that no one requested him to remove the spool, but that it was something he believed that had to be done to perform the concrete pour and that he had performed that task previously.

42. Kenny Constructions workers stated they had previously removed temporary spool pipes in cross passages at the site prior to the day of the incident. When Mr Manning was undertaking the task of removing the temporary spool pipe there were no warnings in place that the west side fire and deluge HDPE were under pressure. The SWMS – Services required exclusion zones to be put in place by Forefront prior to testing and for barriers and/or spotters to be in place. The SWMS – Services also required Forefront at the completion of testing to ensure that any stored energy was released in a control manner.

43. Mr Manning used a rattle gun to release the bolt slightly on the right hand side of the coupling and then moved to the left hand side when pressurised water was released from the riser and struck Mr Manning.

44. Mr Komulainen stated that he had undertaken the removal of spools in XPs on three occasions prior to the incident. However, Mr Komulainen stated that on those occasions the caps on the spool pipes had holes in them, indicating that they could not have been under pressure.

45. Forefront asserted that a barricade was installed at XP25 and the area was cleared of workers other than Mr Stambe and Mr Currey when the pipe was initially pressurised. Forefront asserted that a barricade had remained until Mr Stambe was satisfied there were no leaks in the pipes under pressure. Forefront stated that there was no exclusion zone implemented once the pressure test had been passed.

46. Mr Manning stated that during his time on the site he had not seen pipe work tagged out, barricaded or taped to indicate the pipes might be under pressure. Mr Lawson stated that on previous occasions, when different parts of the fire and deluge system were under pressure, bollards and tape were put in place.

47. Mr Stambe and Forefront asserted that there were no barriers in place in XP25. Mr Stambe and Forefront asserted that the spool could have been removed without unbolting the coupling. They assert that this was because the spool was only sitting in place on a temporary basis and that the spool was connected to the coupling by tie wire only and Mr Stambe stated that to remove the cap from the riser, the tie wire would have had to have been cut. This should have resulted in the spool dropping slightly as it was suspended by the tie wire. Mr Stambe stated that the rolled grooves of the spool were showing, which should have indicated to someone looking at the spool that it had not been connected to the riser as the grooves were required to be covered to connect the spool to another pipe such as the riser.

48. The Joint Venture had a safety management plan that was established by the Project Director as required by clause 37.1 of the Joint Venture Agreement. John Holland and Samsung were required to comply with the directions of the offender which arose out of or in connection with the offender’s obligation as Principal Contractor pursuant to Work Health and Safety legislation. The offender asserted that each of the Joint Venture entities were equally responsible for work, health and safety under the WestConnex Design and Construction Contract. The offender asserted that the safety management systems and related documentation for the Project were provided by the Joint Venture and not the offender.

38. At the time of the incident the Joint Venture documented system of work for the Project also included:

1. Safety Essentials Booklet;

2. WestConnex Project Wide Risk Register (Project Risk Register);

3. WestConnex Capra (Site Risk Register);

4. WestConnex procedures for Managed Work with Stored Energy dated 6 April 2016 (Procedures – Stored Energy);

5. WestConnex procedures for Personal Isolation and Lock Out/Tag Out Process dated 7 July 2017 (Procedure – Personal Isolation);

6. WestConnex procedures for Plant and Equipment Isolation and Tagging dated 23 March 2016 (Procedure – P & E Isolation).

50. The Safety Essentials Booklet outlined the supervision and management of a specific critical risk that people on the Joint Venture’s projects were commonly exposed to. The Project Risk Register identified and described the broad activity that would be a project wide risk, the consequences, assessment and rating of the risk and the controls and actions required. The Site Risk Register identified and described the specific activity that would be a risk for work undertaken in a specific area of the project, the consequences, assessment and rating of the risk and controls and actions required.

51. The Joint Venture did not develop or implement an adequate safe work system for managing the safe performance of hydrostatic pressure testing activities performed by Forefront by ensuring:

1. the identification and marking of services/pipe work that were pressurised/energised;

2. the establishing of exclusion zones;

3. the placing of signage; and

4. the communication of testing, pressurisation and dewatering to other work groups in the area.

52. The Joint Venture did not develop, document and implement a system for the co-ordination and scheduling of hydrostatic pressure testing in work areas where simultaneous operations were being undertaken.

53. Forefront and Kenny Constructions were contractually obliged to comply with directions from the Joint Venture and to have competent representatives on site to supervise work undertaken by them.

54. The offender asserted that at the time of the incident that Kenny Constructions was in control of the works being undertaken by it. Forefront asserted that Mr Stambe was in control of the work activity being undertaken by Forefront. The Joint Venture engaged Mr Lawson to provide supervision of the area. Mr Lawson’s role as tunnel superintendent for the Joint Venture included:

1. overseeing the onsite delivery of defined scopes of work on schedule with all stakeholders;

2. providing leadership, responsibility and health safety and environmental management;

3. providing leadership and risk management, identifying and mitigating risks prior to works commencing, communicating with and engaging relevant stakeholders to control risks and build a risk management culture.

55. Mr Komulainen from Kenny Constructions, provided supervision for the specific works being undertaken by it.

56. At the time of the incident and during pressure testing undertaken on 31 January 2018, Mr Stambe was the onsite supervisor for Forefront.

57. The Joint Venture asserted that in relation to the safety risk assessment for the pressure testing that took place the day before the incident, that the works were carried out under the requirements of the SWMS – Services.

58. Forefront was contractually obliged to implement their own health and safety management system unless the Joint Venture gave written consent for them to comply with the requirements of the Joint Venture Safety and Health Management System. Forefront was contractually obliged to provide the Joint Venture with a safety management plan and an SWMS.

59. Forefront asserted that their safety management system included:

1. Work Health and Safety Policy;

2. Risk Management Policy;

3. SWMS;

4. Job Safety and Environmental Analysis;

5. Site Safety Management Plan;

6. Tool Box Meeting Minutes;

7. Work Health and Safety Meeting Minutes;

8. Checklists.

60. Forefront had an SWMS titled Pipe Services Installation dated April 2017 (Forefront SWMS) for the Project.

61. The Forefront SWMS identified pressure testing as high risk construction work with an associated risk of uncontrolled release of pressure. The Forefront SWMS provided the following hazard controls:

1. Isolation -

1. manage plant and asset isolation and tagging;

2. identify all pipe work and lock out;

3. isolate the line using the shut off valve;

4. place danger tag and lock on valve to prevent re-energisation;

5. bleed off pressure and disconnect.

2. Pressure Testing –

1. length of pipe to be tested to be barricaded at all times during pressure testing;

2. area may be un-barricaded during the filling of the line;

3. spotter to check for leaks;

4. test to be suspended, any remaining pressure bleed off before any repair to leaks.

3. Release of Pressure/Water –

1. notify other in work area before releasing water;

2. inspect and clear area of any electrical equipment likely to be affected.

62. Prior to the incident, the Forefront SWMS was provided to the Joint Venture. Forefront had a “Pipeline Hydrostatic Test Procedures” document. This procedure outlined hydrostatic testing process and requirements for a project undertaken by Forefront at another site. The procedure specified included:

1. warning signs and barricades erected where practical;

2. personnel in immediate vicinity, but not involved in testing process shall be advised of the area to be tested and the duration;

3. test shall be monitored and patrolled throughout duration of pressurisation;

4. isolate test section at specified boundaries using flanges or spades.

63. Mr Stambe stated that he did not provide the Forefront Pipeline Hydrostatic Test Procedures to the Joint Venture. Mr Stambe stated that the procedure was provided to the Joint Venture post-incident.

64. The Joint Venture required that Forefront ensure that the fire and deluge mains must be installed by a plumber or under the immediate supervision of a plumbing supervisor from a company with a plumbing licence. Forefront asserted that no specific qualifications were required to pressure test the pipes, however, that such workers would have a poly weld qualification.

65. Mr Stambe had over five years’ experience in HDPE pipe and conduit installation in underground mining and tunnel projects. Forefront asserted that Mr Stambe had the following qualifications to perform hydrostatic pressure testing of the fire and deluge water pipes on the Project:

1. Enter and Work in Confined Space;

2. Identify, Prevent and Report Potential Workplace Emergency Situation;

3. Confined Small Workplace Emergencies;

4. Work Safely as Safety Observer;

5. Isolate and Access Plant;

6. Poly Weld;

7. Poly Weld.

66. Mr Stambe stated that he attended a two-day induction provided by the Joint Venture. Mr Stambe stated that he was never provided with any formal training by the Joint Venture in regard to commissioning areas.

67. Gordon Parker from Forefront, was Mr Stambe’s supervisor. Mr Parker was an operations manager for Forefront and not on site during the hydrostatic testing. Mr Stambe stated that he usually reported to Mr Parker by telephone. Mr Stambe was not directly supervised by a supervisor from Forefront when carrying out hydrostatic pressure testing. Forefront asserted that Mr Stambe was not supervised as he was qualified to do the work and it was within his competency and responsibility.

68. Kenny Constructions were contractually obliged to provide the Joint Venture with a safety management plan and a SWMS. Kenny Constructions had a SWMS titled “FRP to Various Elements Including Scaffolding Work dated 10 November 2017” (KC – SWMS). Kenny Constructions provided the KC – SWMS to the Joint Venture.

69. At the time of the incident, the documented system of work specific to Kenny Constructions included a reference to the interface risk arising from work performed in the proximity to services, but did not specifically describe that interface risk as pressure testing or hydrostatic pressure testing. The Joint Venture documented system of work specific to Kenny Constructions did not include a reference to the following procedures:

1. Procedures – Stored Energy;

2. Procedures – Personal;

3. Procedures – P & E Isolation.

70. The Joint Venture was issued with an Improvement Notice by SafeWork NSW following the incident. On 16 February 2018 the Joint Venture advised SafeWork NSW that it had undertaken the following steps to address the risk:

1. halted high pressure testing of pipelines;

2. implemented the marking of all high pressure services and identification of the substances within the services;

3. tagged out all high pressure services;

4. reviewed and revised the high pressure test process;

5. ensured the revision of the processes included marking, identification and tagging out.

71. The Joint Venture conducted a post-investigation review. The review identified a number of matters arising from the incident:

1. activities which involved the pressurisation or energisation of services require detailed procedures which are communicated to all personnel involved;

2. above the line controls must be implemented to protect personnel against uncontrolled release of pressure/energy;

3. risk management and identification process must consider changes in work scope;

4. governance activities, eg SWMS audits must be conducted vigorously to ensure all requirements are met;

5. communications between multiple work groups which have interface in the work area must be clear and documented.

72. After the incident the Joint Venture’s documented system of work was amended or created to address the hazards and risks associated with hydrostatic pressure testing.

73. Forefront did not undertake an investigation of the incident.

74. Forefront implemented the following measures after the incident:

1. employment of a HSQE manager on 28 May 2018 reporting directly to the CFO;

2. creation of the position of site superintendent for the Project to monitor compliance issues;

3. creation of the position of operations superintendent for Sydney operations to assist in the management of compliance requirements across their Sydney operations;

4. incorporation into their documented work health and safety system of the following:

1. pressure test checklist;

2. verification of competency document;

3. documented site tool box meeting for Forefront personnel.

75. The pressure test checklist required a check for each procedure undertaken in a pressure test and was required to be verified by a Forefront supervisor and a Joint Venture engineer.

Offender’s Case on Sentence

76. The offender relied on an affidavit of Graeme Richard Silvester sworn 20 July 2021. Mr Silvester is the General Manager, Safety, Health, Environment, Quality, Sustainability and Rail Safety for the offender.

77. Mr Silvester was online during the sentence hearing and not required for cross-examination. Mr Silvester’s evidence can be summarised as follows. I will not repeat matters I have already referred to unless it is necessary to do so.

78. Mr Silvester is part of the Executive Leadership Team of the offender and supervises 21 staff in his department.

79. On behalf of the offender, Mr Silvester acknowledged that the offender failed to comply with its duty and thereby exposed Mr Manning to a risk of death or serious injury.

80. The offender is a construction company with operations spanning Australia, New Zealand and Papua New Guinea. It also has projects in Hong Kong, India, Singapore and the Philippines. The offender currently has 61 active construction projects of which 53 are located in Australia, 18 of those projects are in New South Wales. The offender has 4,500 direct employees and engages more than 7,500 sub-contractors and casual workers in those projects.

81. The Project was managed on behalf of the offender by the Project Management Team. A discrete Project Management Team is set up for each project and is responsible for safely delivering the project. An initial task for the Project Management Team is to consider the project scope and prepare a Project Risk Register and to extract from the Corporate Management System (CMS) all processes and documents required to establish the Project Management System (PMS) for the Project. The PMS identified all of the offender’s procedures within the CMS that were applicable to the Project and the scope of works was used to identify hazards and risks contained in the Project Risk Register. The Project Risk Register included known hazards and risks on the Project and identified the minimum control standards required to be implemented to control those hazards and risks. The Project Risk Register was subject to regular review. During the Project the defendant consulted with specialist sub-contractors prior to the work commencing to discuss hazards and risks for the specialist tasks that were being undertaken by the sub-contractor. The specialist tasks were those that were outside of the offender’s knowledge and core business expertise.

82. The offender also developed a Construction Area Risk Assessment for each construction area within the Project. The offender requires that each project is separated into different sections referred to as construction areas. The Project Risk Register was then used to develop the Construction Area Risk Assessment for each construction area. The Construction Area Risk Assessment provided a more detailed assessment of the risks and hazards associated within a construction area by further analysing the risks and hazards and the required control standards from the PMS or the CMS or if further documentation was required. A construction area plan was then developed for the construction area that set out the scope of works, along with known hazards and risks of the work activities as identified in the Construction Area Risk Assessment.

83. The offender required the development of Work Packs for each package of works to be completed by sub-contractors within a construction area. Work Packs outline high level project specific information including activity scope, location and task information for the Project. A number of documents are attached to the Work Packs, for example, survey drawings, design drawings, inspection and test plans.

84. The PMS for the Project included procedures that required Forefront to develop a detailed safe system of work including an SWMS. An SWMS was required for all work that was high risk construction work. The obligation to develop an SWMS was reflected in the terms of the contract between the offender and Forefront.

85. The offender takes a pro-active approach to managing sub-contractors. This starts with an evaluation of tenders to ensure that the offender appoints an appropriate sub-contractor and then monitoring the performance of their work. This included the testing activities being performed by Forefront at the time of the incident. The Project Management Team implemented a system of contractor management for the Project. The purpose of this system was to ensure the appointment of suitably qualified specialist contractors and the monitoring of the performance of work by specialist contractors to positively influence safety outcomes of contracted works.

86. The contractor management system for the Project required that:

1. specialist sub-contractors, including Forefront, be selected in accordance with a procurement process which included financial and non-financial considerations in their ability to perform the package of works. Non-financial considerations included the expertise of Forefront to manage work, health and safety (WHS) and that it aligned with the offender’s safe systems of work;

2. a pre-mobilisation meeting be held with each sub-contractor, including Forefront, before the commencement of work on the Project. At this meeting, senior members of the Project team communicate to sub-contractors, including Forefront, their expectations for the safe completion of the work including:

1. the expectations regarding alignment to the offender’s Safety Essentials and One HSE Culture Framework;

2. worker pre-commencement processes, including detailed project inductions;

3. the requirement of sub-contractors, including Forefront, to conduct risk assessment and develop a detailed system of work to control risks within the specialist sub-contractor’s knowledge and expertise;

4. the methods of communication, co-operation and consultation with sub-contractors, including Forefront; and

5. the way in which the offender would undertake work place inspections and task observations.

3. prior to commencing works and throughout the Project, sub-contractors, including Forefront, be provided with information and instruction from the Project work sites and other concurrent works through the following:

1. project, site and tunnel inductions, which included information about an instruction on the offender’s Safety Essentials; and

2. daily pre-start briefings.

4. the Project Management Team and the Project WHS Team undertook work place inspections and task observations to provide assurance over the effectiveness of the risk management activities conducted by workers on the Project including Forefront.

87. On the day of the incident, the pre-start briefing was documented and listed planned activities for the shift, which included:

1. work on XP25 to XP29;

2. Forefront install HDPE/conduits; and

3. formwork, reinforcing steel and concrete placement.

88. The PMS also required review of SWMS put forwarded by sub-contractors. This review process included consideration against the PMS SWMS review checklists (Review Checklist) which involved an examination of sub-contractors’ SWMS to ensure that they aligned with the offender’s expectations for managing the work safely.

89. An SWMS identifies hazards and risks arising from a sub-contractor’s activities and the control measures to be put in place. Sub-contractors are required to comply with the applicable SWMS for their package of works and the offender, as the Principal Contractor, conducts ongoing workplace inspections and task observations to ensure compliance with the systems of work set out in the applicable SWMS.

90. The SWMS that applied to the work being undertaken by Forefront was the SWMS – Services, which identified pressure testing of HDPE pipes and the associated hazard of an uncontrolled release of energy. The control measures described in the SWMS – Services included:

1. ensure all exclusion zones are in place prior to testing and that barriers and that all spotters are in place;

2. ensure pressure testing plan and checklist is in place and adhered to; and

3. at the completion of testing ensure any stored energy is released in a controlled manner.

91. The CMS requires the offender to undertake a review of systems and processes in response to a range of issues including incidents and near misses. This requires the offender to conduct an incident investigation and identify appropriate corrective actions to prevent recurrence and to ensure organisational learnings are applied on the Project and then across the offender’s operations. These post-incident processes were invoked following the incident and as a result a number of changes were implemented.

92. A Flash Report was prepared by the Project Safety Director and issued by Mr Silvester to all of the offender’s projects on 2 February 2018. The CMS requires that a Flash Report be issued within 24 hours of an incident resulting in an injury requiring medical treatment. A Flash Report is designed to communicate to all persons working on a project of an overview of the incident in real time as it is then understood with a request that workers have a discussion at pre-start briefings about the incident, including the hazards, the rules and procedures required for the job. The Flash Report was accompanied by an email requiring a review of the pressure testing being undertaken on all projects.

93. A Significant Incident Review was undertaken by the Tunnelling Business Unit Safety and Health Manager, supported by the Tunnelling Business Unit Safety, Health, Environment and Quality Manager and the Project Safety Director along with external experts in hydrostatic pressure testing. A PowerPoint presentation outlining the incident and other factors surrounding it as well as the actions to be taken to prevent recurrence was presented to the Review Team. A number of Key Learnings were identified. Mr Silvester managed the implementation of the Key Learnings through the development of new documented procedures for hydrostatic pressure testing which were then communicated to the offender’s workers. A document titled “Lessons Learnt” was published on 17 February 2018 and distributed on all of the offender’s projects and discussed at all pre-start briefings.

91. As a result of completing the Significant Incident Review, the offender obtained knowledge that hydrostatic pressure testing that it did not have prior to the incident. The offender used this information to develop comprehensive procedures to be implemented that were superior to the SWMSs of sub-contractors it had previously relied on.

92. The offender established a working party including external hydrostatic testing experts to conduct an Australia wide literature search and to ascertain information from specialist organisations relating to hydrostatic pressure testing. That information was used to develop the procedure document.

93. The working party developed:

1. the Hydrostatic Pressure Testing Procedure;

2. the Permit to Hydrostatically Test;

3. the Hydrostatic Pressure Test Bulletin; and

4. the Safe Distance for Pressure Testing Guide.

97. Each of the documents incorporated requirements of the relevant Australian Standards.

98. The content of the procedures developed by the working party are extensive and comprehensive. They are regularly reviewed where work is being undertaken on a project. Since the procedures were established and implemented, there have been 117 inspections conducted on whether hydrostatic pressure testing was being conducted in accordance with the procedures, with no non-compliances being identified during those inspections. There have not been any further incidents involving hydrostatic pressure testing since the incident.

99. The offender has a number of high level safety policies in place, including the offender’s Vision Statement and the offender’s Safe Work Strategy 2019-2021. These documents are frequently reviewed by senior employees of the offender.

100. The offender is an accredited contractor by the Office of the Federal Safety Commissioner. The offender was first accredited in 2009 and has been required to undergo regular independent audits conducted by independent Federal Safety Officers to maintain the accreditation which allows it to be engaged by the Federal Government in construction works valued above $5 million.

101. The offender monitors its safety performance using industry standard safety metrics. The offender compares favourably to its industry peers.

102. The offender participates in safety projects in the building and construction industry in Australia. It has recently completed, for example, the Piling Improvement Project which was initiated by the offender to address a number of incidents involving piling rigs. The offender itself does not operate piling rigs but engages specialist sub-contractors for this work. However, as a senior industry participant, the offender identified the opportunity to improve the way in which piling rigs were operated on its sites.

103. The offender has led broad industry engagement through a programme called PileSafe. The offender has driven the development of a nationally recognised Certificate of Competency for piling rig operators and has presented specialist information on the project to relevant bodies including safety regulators. The offender has participated in similar initiatives relating to the operation of mobile elevating work platforms and articulated mobile cranes.

104. Mr Silvester deposed to the key elements of the offender’s approach to health and safety which include the CMS, the One HSE Culture Framework, Risk Management, regular reporting systems, built-in safety key performance indicators and the communication of health and safety campaigns. The offender has developed four key safety campaigns to deliver strategic knowledge to reinforce fundamental safety messages.

105. The offender’s CMS is accredited for safety management systems and has received certification from quality assurance bodies.

106. The offender uses an information technology cloud based online reporting software application to manage its WHS requirements referred to as “Synergy”. Synergy assists the offender and projects to consistently manage their risks and to capture, report, manage safety and health, environment, quality, sustainability and rail safety performance. It is used to analyse data including tracking corrective actions and to identify trends and data reported by projects, Business Units and in the corporation. Each Business Unit of the offender prepares a monthly report detailing safety issues for the previous month. That information is used to develop the next month of safety projects. The offender issues weekly emails regarding safety and health performance. There are regular meetings with the Executive Leadership Team where safety performance is the first item discussed. There are regular meetings of the Directors of the offender where safety is the first item discussed.

107. The offender operates a suite of seven Safety Essentials being:

1. Working at Heights;

2. Working in and around Mobile Plant;

3. Working near Live Traffic;

4. Mobile Cranes and Lifting Operations;

5. Temporary Works;

6. Work around Live Services; and

7. Electrical Works.

108. The Safety Essentials are included as part of each worker’s site inductions and every worker is required to comply with them on a site controlled by the offender.

109. The offender contributes to the community in a number of different ways. The offender is committed to diversity and inclusion including Indigenous employment, Indigenous procurement, social enterprise engagement and gender diversity.

110. The offender’s Career Trackers Indigenous Internship Program is designed to increase its employment of Aboriginal and Torres Strait Island university graduates. To date, 113 Indigenous university students have completed internships with the offender. The offender has worked with Reconciliation Australia to develop relevant policies. The offender is also committed to procuring goods and services from Indigenous suppliers.

111. The offender also supports Workplace Diversity through its participation in CareerSeekers program. It also recognises the importance of gender diversity encouraging women to become leaders in the building and construction industry and being a pay equity ambassador.

112. Mr Silvester deposed that the offender co-operated with SafeWork’s investigation into the incident.

113. On behalf of the Executive Leadership Team, Mr Silvester deposed that the offender was genuinely upset by the incident. Mr Silvester was authorised by the Managing Director to apologise to Mr Manning and to express the offender’s sincere regret that he had been injured in circumstances where the offender had breached its work health and safety obligations. In December 2020, Mr Manning was a registered worker of Kenny Constructions on the offender’s Parramatta light rail project.

114. The offender maintains the position that any injury to a worker is unacceptable. Mr Silvester deposed that he has the power to identify any changes or improvements that might be necessary to achieve an injury free operation. Mr Silvester deposed that the incident was a reminder of the need to be ever vigilant and proactive in WHS obligations.

Consideration

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

Objective Seriousness

116. The offence is objectively serious for the reasons that follow.

117. The risk of an uncontrolled release of energy from stored water after the hydrostatic pressure test was known to the offender and identified in the SWMS – Services that had been prepared by the Joint Venture in consultation with Forefront. The hydrostatic pressure testing was identified as high risk construction work. The SWMS – Services identified the control measures that were to be implemented by the specialist sub-contractor, Forefront, to eliminate or minimise the risk, including the use of exclusion zones and the controlled release of the water at the conclusion of the test. Forefront failed to implement those control measures and conducted the hydrostatic pressure testing on 31 January 2018 in a different way to that which had been adopted previously, without notice to the offender. The identification of the risk by the offender and appropriate control measures were brought about by the application of the offender’s comprehensive safety systems that were in place, generally and for the Project.

118. The offender also had in place comprehensive systems for scheduling and communication between it and sub-contractors that applied to the hydrostatic pressure testing. The offender accepts that as the Principal Contractor it was responsible for monitoring that the work of sub-contractors was being conducted in accordance with the documented systems of work and that its systems for co-ordinating the work of different sub-contractors in or near the pressurised pipes were inadequate. The offender also admits that the documented systems of work for the safe management of the hydrostatic pressure testing could have been more comprehensive.

119. The likelihood of the risk occurring was minimal to low if the identified control measures were taken by Forefront. Hydrostatic pressure testing had taken place on prior occasions during the Project without incident.

120. The potential consequences of the risk included a risk of death.

121. The offender had implemented a system of work which, if followed by Forefront, would have eliminated or minimised the risk. As a result of the incident, the offender undertook an extensive review of the task of hydrostatic pressure testing and formulated a comprehensive set of peer-reviewed policies to be implemented to deal with the risks and hazards arising from it, on the Project and in future projects. The Working Party gathered knowledge from available literature, external experts and senior employees of the offender, to provide the offender with knowledge about hydrostatic pressure testing that it did not possess before the incident. The offender has gone above and beyond what was necessary to formulate and implement the new hydrostatic pressure testing procedures. In the circumstances, it would be overly simplistic to say that the steps taken in response to the incident were simple, well-known and inexpensive to implement, notwithstanding that the minimum steps identified in [22(a)] of the Amended Summons were such steps. It should be recognised that those types of steps were prescribed in the SWMS – Services prior to the incident.

122. The serious injury sustained by Mr Manning is an aggravating feature of the offence.

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

Deterrence

124. The penalty imposed in relation to this offence must provide for general deterrence. Employers must take the obligations imposed by the Act very seriously. The community is entitled to expect that both small and large employers 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].

125. The penalty imposed must also provide for specific deterrence. The offender is involved in many large projects that involve the exposure of workers to risks from construction work including high risk construction work as defined in cl 291 Work Health and Safety Regulation 2017 (the Regulations). However, the offender has demonstrated in its response to this incident and by reference to its other industry safety undertakings, that it has a comprehensive and proactive approach to safety and conducts itself as a responsible Principal Contractor.

Aggravating Factors

126. The injury, harm and loss caused by the s 32 offences was substantial: s 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. In this case, Mr Manning sustained serious injuries and that is sufficient to make out the aggravating factor.

Mitigating Factors

127. The offender has good prospects of rehabilitation: s 21A(3)(h) Crimes (Sentencing Procedure) Act 1999. The offender has demonstrated by its extensive safety systems that were in place prior to the incident and by its commitment to improving those systems since the incident, that it has good prospects of rehabilitation. The offender has implemented an extensive system for the safety of hydrostatic pressure testing that makes re-offending in this aspect of its operations unlikely.

128. The offender has demonstrated remorse: s 21A(3)(i) Crimes (Sentencing Procedure) Act 1999. Mr Silvester, on behalf of the offender, has accepted responsibility for the failings that led to the offence and expressed remorse. I am satisfied that the offender has expressed genuine contrition and remorse.

129. The offender entered a plea of guilty: s 21A(3)(k) and s 22 Crimes (Sentencing Procedure) Act 1999. It 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 offender had entered a plea of not guilty and the matter was set down for hearing. The parties entered into negotiations and the offender pleaded guilty as soon as the Amended Summons was filed. There is still considerable utilitarian value in the offender’s plea of guilty, but I am not satisfied that I can assess the discount at the maximum that can be allowed. The appropriate discount is 15%.

130. The offender co-operated with the SafeWork investigation: s 21A(3)(m) Crimes (Sentencing Procedure) Act 1999.

131. The offender has demonstrated itself to be a good corporate citizen by its involvement in charitable and community causes, its promotion of industry safety initiatives and its pursuit of diversity in its workforce and the industry generally.

132. Forefront pleaded guilty to the s 32 offence laid against it. On 23 July 2021, Judge Strathdee imposed a fine of $112,500 after allowing a discount for the plea of guilty of 25%. The offending conduct of Forefront was different to that alleged against the offender and parity may not strictly apply, but the penalty imposed on Forefront is a relevant consideration to be taken into account.

Other matters

133. The offender has prior convictions under the former legislation. The most recent offence was committed in 2010. The offences are not similar to the offence in question. It was not contended by the prosecutor that the prior convictions were an aggravating factor. In the same vein, it was not contended by the offender that the corresponding mitigating factor was established.

Penalty

134. CPB Contractors Pty Ltd is convicted.

135. The appropriate fine is one of $100,000 that will be reduced by 15% to give effect to the plea of guilty.

136. I impose a fine of $85,000.

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

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

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Decision last updated: 03 August 2021