SafeWork NSW v Leda Form Group Pty Ltd

[2022] NSWDC 524

District Court

New South Wales

Medium Neutral Citation:

SafeWork NSW v Leda Form Group Pty Ltd [2022] NSWDC 524

Hearing dates:

27 October 2022

Date of orders:

3 November 2022

Decision date:

03 November 2022

Jurisdiction:

Criminal

Before:

Russell SC DCJ

Decision:

(1)   Leda Form Group Pty Ltd is convicted.

(2)   The appropriate fine is $600,000 but that will be reduced by 25% to reflect the early plea of guilty.

(3)   Order Leda Form Group Pty Ltd to pay a fine of $450,000.

(4) Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor.

(5)   Order Leda Form Group Pty Ltd to pay the prosecutor’s costs.

Catchwords:

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

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

COSTS – prosecution costs

OTHER – defendant involved in installation of formwork on construction project – three workers on a roof preparing to install formwork – worker stepped backwards and fell through an uncovered penetration beside the lift shaft – worker fell 19 metres to the concrete floor below – failure to undertake adequate risk assessment – failure to securely cover penetration – failure to install perimeter guard rails around penetration – failure to prohibit workers from undertaking work on roof until adequate protection against risk had been installed – failure to implement and enforce adequate safe work method statement – failure to provide information, training and instruction to workers – failure to provide adequate supervision to workers

Legislation Cited:

Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 22

Fines Act 1996 (NSW), ss 6, 122

Work Health and Safety Act 2011 (NSW), ss 3, 19, 32

Work Health and Safety Regulation 2011 cl 78, 79, 291, 299

Cases Cited:

Baumer v R [1988] HCA 67; (1988) 166 CLR 51

Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338

BW v R [2011] NSWCCA 176

Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610

Mahdi Jahandideh v The Queen [2014] NSWCCA 178

Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120

Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96

R v McNaughton [2006] NSWCCA 242; (2006) 66 NSWLR 566

R v Wilkinson (No. 5) [2009] NSWSC 432

Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266

Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465

Texts Cited:

SafeWork NSW Code of Practice, Managing the Risk of Falls at Workplaces, April 2016

Safe Work Australia, Safe Work on Roofs Information Sheet, January 2016

Category:

Sentence

Parties:

SafeWork NSW (Prosecutor)
Leda Form Group Pty Ltd (Defendant)

Representation:

Counsel:
M Moir (Prosecutor)
S Issa (Solicitor) (Defendant)

Solicitors:
Department of Customer Service (Prosecutor)
Firmstone & Associates (Defendant)

File Number(s):

2021/234842

Judgment

1. On 21 August 2019 Mr Mohamad Riche, Mr Issa Ibrahim and Mr Bill Hallani were on a roof preparing to install formwork for the construction of a lift overrun for a lift shaft. Directly beside the lift shaft was a penetration designed to accommodate an exhaust vent. Mr Riche stepped backward and fell through the penetration approximately 19 metres to the concrete floor below.

2. Leda Form Group Pty Ltd (Leda) has pleaded guilty to an offence that as a person who had a work health and safety duty pursuant to s 19(1) of the Work Health and Safety Act 2011 (NSW) (the Act) it failed to comply with that duty and thereby exposed Mr Riche, Mr Issa Ibrahim and Mr Hallani to a risk of death or serious injury contrary to s 32 of the Act.

3. The maximum penalty for the offence is a fine of $1,500,000.

The Risk

4. The risk described in par 15 of the Summons is as follows:

“The risk was the risk to workers, including Mr Riche, Mr Ibrahim and Mr Hallani, of death or serious injury as a result of falling through the penetration whilst undertaking work on the roof level of Building B.”

Reasonably Practicable Measures

5. Paragraph 16 of the Summons pleads particulars of the defendant’s failure to comply with the duty under s 19(1) of the Act as follows:

“16. The defendant failed to ensure so far as is reasonably practicable the health and safety of workers, in particular Mr Riche, Mr Ibrahim and Mr Hallani in that it failed to take one or more of the following reasonably practicable measures to eliminate or, alternatively minimise, if it was not reasonably practicable to eliminate, the risk:

(a) Undertaking an adequate risk assessment for the work that identified the risk of a fall through penetrations at the site, including the penetration, assessed the risk and identified the most effective control measures to manage the risk;

(b) Securely covering, or requiring Coplex to securely cover, the penetration with material that was clearly marked and strong enough to prevent people falling into the penetration;

(c) Installing, or requiring Coplex to install, perimeter guard rails around the penetration;

(d) Prohibiting workers from undertaking work on the roof level of Building B until adequate protection against the risk had been installed in the form of guard rails and/or secure covers strong enough to prevent persons falling into the penetration;

(e) Implementing and enforcing a Safe Work Method Statement (SWMS) for the work that identified the hazard created by penetrations at the site, including the penetration, and described the measures to be implemented to manage the hazard, including the measures set out above at paragraphs (b), (c) and (d);

(f) Providing information, training and instruction to workers about the hazard created by the penetrations and the measures implemented to guard against it, in accordance with the SWMS;

(g) Providing adequate supervision to workers to ensure compliance with the SWMS.”

6. Counsel for the prosecutor indicated in oral submissions that the prosecutor did not rely upon the word “developing” in par 16(e) of the Summons.

Background

7. The prosecutor tendered a Prosecution Sentence Tender Bundle (PX 1) which contained an Agreed Statement of Facts (PX 1, Tab 2). This material is summarised below.

8. Leda conducted a business or undertaking involving the construction and installation of formwork on construction projects.

9. Coplex Construction Pty Ltd (Coplex) conducted a business involving construction work and specialised in providing construction management services.

10. In November 2017 Coplex was engaged by 3CO Jordan Springs Pty Ltd (3CO) to construct 79 residential apartments in two blocks (Building A and Building B) over two basement levels at 98-116 Lakeside Parade, Jordan Springs (the site). 3CO was the owner of the property. Coplex was the principal contractor for the project at the site. Mr Hallani was the Coplex site manager for Building B.

11. Mr Danny Ibrahim and Mr Rami Ibrahim were directors of Coplex and were employed as the General Managers of the site.

12. On 1 April 2019 Leda was engaged by Coplex to supply and install formwork and supporting falsework for the project at the site. Daily instruction and supervision of Leda workers at the site was provided by Mr Riche.

13. Mr Riche was employed full-time by Leda as the site manager. He had worked for Leda since 2014.

The Works at the Site

14. Leda commenced work at the site in August 2018. Leda left the site for a period before returning in or about April/May 2019 to commence work on the supply and installation of formwork and supporting falsework for the construction of the buildings, starting with the basement levels.

15. Leda completed the construction of falsework and formwork for the roof level slab of Building B at the site around 13 August 2019. Concrete for the Building B roof level slab was placed and finished around 17 August 2019.

16. On 20 August 2019 Leda attended a Coplex weekly contractor meeting on site. After the contractor meeting a safety walk was conducted by Coplex and its subcontractors, including Leda, for the purpose of identifying and eliminating any safety issues on site and checking compliance by contractors with each Safe Work Method Statement (SWMS). The safety walk included inspecting whether Leda was complying with its SWMS and whether any ventilation shafts were left uncovered by Leda. During these safety walks, Coplex safety officers recorded in writing any safety risks that were identified. The safety walk did not include inspection of the roof level of Building B.

17. Mr Riche attended the safety walk on behalf of Leda.

18. The site safety officer for Coplex was Mr Simon Ibrahim. Mr Simon Ibrahim monitored and inspected the site on a daily basis and conducted the weekly site safety walks with contractors. Mr Simon Ibrahim’s role included the daily inspection of the works for hazards and work health and safety risks.

The Incident

19. On 21 August 2019 Mr Riche, Mr Issa Ibrahim and Mr Hallani were working on the roof deck of Building B at the premises. Mr Issa Ibrahim was one of Leda’s formworkers. They were preparing to install formwork for the construction of a lift overrun for the lift shaft of Building B. They had been working at the premises leading up to that day.

20. Mr Hallani was standing inside the lift shaft on scaffolding. Mr Issa Ibrahim and Mr Riche were standing on the roof outside the four walls of the lift shaft which protruded about 1.5 metres above the roof deck. Directly beside the lift shaft was a penetration of 2.1 x 0.7 metres which was designed to accommodate an exhaust vent for the carpark located in the basement of Building B (the penetration). The penetration was approximately 19 metres above the basement. The ventilation shaft was six storeys in height.

21. On the day of the incident, the penetration was open and there was no cover over it. The penetration was not securely covered in a manner that would prevent a person from falling through it to the basement level.

22. While working on the roof Mr Riche was attempting to remove a piece of timber placed across the lift shaft. Mr Hallani was assisting him to remove this timber and was standing on the scaffolding in the lift shaft. Mr Riche stepped backwards and fell into the penetration and then 19 metres to the basement concrete floor below. He died from the fatal injuries he received. Mr Riche was 38 years old at the time of the incident.

Guidance Materials

23. Clause 78 of the Work Health and Safety Regulation 2011 (the Regulation) provided that duty holders must manage the safety risks associated with a fall, including openings through which a person could fall.

24. Clause 79 of the Regulation set out the specific requirements to minimise the risk of fall. Clause 79(3) set out a hierarchy of controls for providing adequate protection against the risk of a fall:

“(3) The person provides adequate protection against the risk if the person provides and maintains a safe system of work, including by:

(a) providing a fall prevention device if it is reasonably practicable to do so, or

(b) if it is not reasonably practicable to provide a fall prevention device, providing a work positioning system, or

(c) if it is not reasonably practicable to comply with either paragraph (a) or (b), providing a fall arrest system, so far as is reasonably practicable.”

25. Clause 79(5) of the Regulation provided that a “fall prevention device” includes edge protection and penetration covers.

26. The work carried out by Leda was “high risk construction work” within the meaning of cl 291(a) of the Regulation because it involved a risk of a person falling more than two metres through the penetration for the ventilation shaft. Leda was required, pursuant to cl 299(2) of the Regulation, to prepare a SWMS for the work that:

1. specified the hazards relating to the work.

2. specified the risks to health and safety associated with those hazards.

3. described the measures to be implemented to control the risks.

4. described how the control measures are to be implemented, monitored and reviewed.

27. SafeWork NSW Code of Practice, Managing the Risk of Falls at Workplaces, dated April 2016 (the Code) was published and available to Leda prior to the incident. The Code relevantly provided:

1. The Regulation requires duty holders to work through the hierarchy of controls to choose the control that most effectively eliminates or minimises the risk in the circumstances. This may involve a single control measure or a combination of two or more different controls.

2. A fall prevention device (for example, a secure fence, edge protection, work platform or cover) must be used to provide and maintain a safe system of work where persons are working near and around holes, penetrations and openings through which a person could fall, if it is reasonably practicable to do so.

3. If a penetration cover is used as a control measure it must be made of a material strong enough to prevent people or objects falling through the hole, penetration or opening and should be securely fixed to prevent dislodgement or accidental removal. Covers over penetrations should be designed to safely withstand a point load of at least 2 kilonewtons ie 200 kilograms.

4. Guardrails may be used to provide effective fall prevention around openings in floor and roof structures.

28. Safe Work Australia, Safe Work on Roofs Information Sheet, dated January 2016 was published and available to Leda prior to the incident. The Information Sheet relevantly provided:

1. Falls from height are the major cause of death and injury when working on roofs.

2. Hazards to consider in managing fall risks include unprotected edges, skylights, holes and vents and trip hazards.

3. Workers such as electricians, plumbers, pest control operators, installers of roof aerials, solar panels and air-conditioning systems, can trip and fall on roofs, through roofs and openings or while accessing or exiting roof areas.

4. Falls from even low heights can leave workers with permanent and debilitating injuries such as fractures, spinal cord injuries, concussion and brain damage. The risk of serious injury or death from a fall increases significantly as working heights increase.

5. The risk of falls must be managed using the most effective control measures that are reasonably practicable, in accordance with the hierarchy of controls.

6. Protection must be provided if there is a risk of falling through the roof and work is being done on the top of the roof. Control measures to prevent injury from work on roofs include using barriers such as guard rails or covers that are secured and labelled with a warning.

Systems of Work Prior to the Incident

29. There was a SWMS issued by Leda that related to penetrations on formwork decks at the premises (PX 1, Tab 10). Mr Riche signed the SWMS. The SWMS referred to the need to use covers secured with nails for every penetration and for those covers to be “safe for foot traffic”. The SWMS also referred to the need to use handrails or a leading edge, if a penetration was large enough to be a fall hazard. Mr Adel Dayoub, the sole director of Leda, was nominated in the SWMS as the person responsible for the implementation of measures to be taken to control hazards.

30. Coplex conducted site toolbox talks in which the requirement to maintain covers over penetrations was discussed.

31. There were no handrails or perimeter guard rails installed around the penetration for the ventilation shaft of Building B through which Mr Riche fell.

32. The penetration through which Mr Riche fell was not safe, as it was not securely covered.

33. There were ample supplies of plywood on the roof of Block B, which could have been used to cover the penetration (PX 1, Tab 6, p 4).

Steps Taken After the Incident

34. Following the incident, the penetration through which Mr Riche fell was covered with plywood sheets resting on lengths of laminated veneer lumber and secured down with nails. The word "PENO" was spray painted across the plywood sheets.

35. Leda took the following steps after the incident:

1. It sent two employees to complete a Health and Safety Representatives course.

2. It made arrangements for some of its employees to attend Working at Heights training and First Aid training.

Evidence for the Defendant

36. Leda did not tender an affidavit or any other evidence. The solicitor for Leda, Mr Issa, made oral submissions at the sentence hearing.

Consideration

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

Objective Seriousness of the Offence

38. The proportionality principle requires that a sentence should neither exceed nor be less than the gravity of the crime having regard to the objective circumstances: Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465 at 472, 485-6, 490-1 and 496. At common law, the term “objective circumstances” was used to describe the circumstances of the crime. The gravity of the offence was assessed by reference to its objective seriousness: R v McNaughton [2006] NSWCCA 242; (2006) 66 NSWLR 566 at [15].

39. The task requires the court to consider where in the range of conduct covered by the offence the conduct of the offender falls: Baumer v R [1988] HCA 67; (1988) 166 CLR 51 at 57. This assessment will generally indicate the appropriate range of sentences available which will reflect the objective seriousness of the offence committed, and set the limits within which a sentence proportional to the criminality of the offender will lie: BW v R [2011] NSWCCA 176 at [70].

40. In Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120 at [27] the High Court said:

“The objective seriousness of an offence is to be assessed without reference to matters personal to a particular offender or class of offenders. It is to be determined wholly by reference to the nature of the offending.”

41. The sentencing judge should take into account not only the conduct which actually constitutes the crime, but also such of the surrounding circumstances as are directly related to that crime and are properly regarded as circumstances of aggravation or mitigation: R v Wilkinson(No. 5) [2009] NSWSC 432 at [61].

42. The existence of a reasonably foreseeable risk to safety that is likely to result in serious injury or death is a factor relative to the gravity of the offence: Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 at [82]. The question of foreseeability of the risk is to be determined objectively.

43. 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. This approach to sentencing, known as the “instinctive synthesis” approach, involves the making of a global judgment without any attempt to state precisely how any given factor has influenced the judgment.

44. The Court of Criminal Appeal has examined the sentencing process with regard to the Act in the matter of Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96. Justice Basten at [34], under the heading “Assessment of Risk” said:

“The sentencing judge commenced his consideration with the proposition that ‘greater 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 on assessment of all those factors.”

45. Further at [42] his Honour continued:

“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 [event] 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 little, if any, costs.”

46. At [53] his Honour 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 the failure to take reasonably practicable steps to avoid the injury occurring. To discount the seriousness of the risk by reference to the unlikelihood of injury resulting 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 materialize. The objective seriousness of the conduct will also be affected by the ease with which mitigating steps could have been taken.”

47. My findings about the defendant’s level of culpability are based upon the following:

1. Leda knew of the risk. It was specifically mentioned in Leda’s SWMS. In any event the risk was obvious and foreseeable as there was guidance material directed to this particular risk.

2. The likelihood of the risk occurring was high. There were many dangerous unguarded penetrations on the roof. Workers concentrating on the task at hand were at risk of inadvertently stepping into an uncovered void.

3. The potential consequences of the risk were death or serious injury.

4. Simple and well-known steps were readily available to eliminate or minimise the risk. They were all listed on Leda’s SWMS.

5. There was no great burden or inconvenience in these steps being implemented.

6. Mr Riche died. Two other workers were put at risk.

7. The maximum penalty for the offence is a fine of $1,500,000, which reflects the legislature’s view of the seriousness of the offence.

8. There was no explanation provided by Mr Dayoub on behalf of Leda as to why the penetration was not covered or why the site inspection did not include the roof area on Block B.

48. I find that the level of culpability of Leda is in the upper half of the mid range. Both parties made this submission, and it accords with my own assessment of objective seriousness.

Deterrence

49. 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 Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338 at [180].

50. The penalty must reflect the need for specific deterrence. Leda is still in existence, although Mr Issa submitted that it had not carried out any work for the last 18 months, since finishing the Jordan Springs project. Its past operations involve construction, the installation of formwork on construction projects and the engagement of workers.

Aggravating Factors

51. The injury, emotional harm, loss or damage caused by the offence was substantial: s 21A(2)(g) Crimes (Sentencing Procedure) Act 1999.

Mitigating Factors

52. Leda has no prior record of conviction: s 21A(3)(e) Crimes (Sentencing Procedure) Act 1999.

53. Leda has shown remorse for the offence by its guilty plea, a matter conceded for the prosecutor.

54. Leda entered a plea of guilty: s 21A(3)(k) Crimes (Sentencing Procedure) Act 1999. The court must take into account the fact that the offender has pleaded guilty, when the offender pleaded guilty, and the circumstances in which the offender indicated an intention to plead guilty: s 22(1) Crimes (Sentencing Procedure) Act 1999. It is appropriate to give Leda a 25% discount for an early plea, a matter conceded for the prosecutor.

55. Leda gave assistance to law enforcement authorities: s 21A(3)(m) Crimes (Sentencing Procedure) Act 1999. It cooperated at all times with the prosecutor and provided all documents requested in a prompt fashion, a matter conceded for the prosecutor.

Capacity to Pay a Fine

56. I am required to have regard to s 6 of the Fines Act 1996 (NSW) before imposing a fine. Where an offender seeks to have a fine reduced on the basis of a limited capacity to pay, it 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: Mahdi Jahandideh v The Queen [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.

57. In Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266 at [79] the Court of Criminal Appeal said:

“First, and more generally, questions of specific deterrence should take into account the size and scope of the operations of the defendant; a fine which may be crippling to a small business may have virtually no impact on the financial operations of a large corporation. The maximum penalty for the offence is undoubtedly set having regard to such a factor. Secondly, the Court is required to have regard to ‘the means’ of the defendant, pursuant to s 6 of the Fines Act 1996.”

58. There was no evidence about capacity to pay, so this issue does not arise. Mr Issa did make oral submissions about the “dire” financial state of Leda, but I indicated to him that in the absence of any evidence on the topic, the court could not take those submissions into account.

Costs

59. There will be an order that the defendant is to pay the prosecutor’s costs.

Penalty

60. My orders are:

1. Leda Form Group Pty Ltd is convicted.

2. The appropriate fine is $600,000 but that will be reduced by 25% to reflect the early plea of guilty.

3. Order Leda Form Group Pty Ltd to pay a fine of $450,000.

4. Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor.

5. Order Leda Form Group Pty Ltd to pay the prosecutor’s costs.

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Decision last updated: 03 November 2022