SafeWork NSW v State Asphalt Services Pty Ltd

[2025] NSWDC 75

District Court

New South Wales

Medium Neutral Citation:

SafeWork NSW v State Asphalt Services Pty Ltd [2025] NSWDC 75

Hearing dates:

12 March 2025

Date of orders:

21 March 2025

Decision date:

21 March 2025

Jurisdiction:

Criminal

Before:

Strathdee DCJ

Decision:

(1)   The defendant is convicted.

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

(3)   Accordingly, the defendant is to pay a fine of $450,000.

(4) Pursuant to s 122(2) of the Fines Act 1996 (NSW), 50% of the fine imposed is to be paid to the prosecutor.

(5) Pursuant to s 257B of the Criminal Procedure Act 1986 (NSW), the defendant is to pay the prosecutor's costs, as agreed or assessed.

Catchwords:

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

SENTENCE – objective seriousness – mitigating factors – aggravating factors – plea of guilty – appropriate discount for the utility of the plea – general deterrence – specific deterrence – remorse and contrition

COSTS – prosecutor’s costs

Legislation Cited:

Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 22, 23A

Criminal Procedure Act 1986 (NSW), s 257B

Fines Act 1996 (NSW), ss 6, 122

Work Health and Safety Act 2011 (NSW), ss 19(1), 31, 32

Cases Cited:

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

Capral Aluminium Ltd v WorkCover Authority (NSW) (2000) 49 NSWLR 610; [2000] NSWIRComm 71

Environmental Protection Authority v Barnes [2006] NSWCCA 246

Haynes v CI & D Manufacturing Pty Limited (No 2); Callaghan v CI & D Industries Pty Limited (No 2) (1995) 60 IR 455

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

Jahandideh v R [2014] NSWCCA 178

Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534

Lawrenson Diecasting Pty Ltd v WorkCover Authority (NSW) (1999) 90 IR 464

Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25

McColl v John Watson Building Services Pty Ltd (2004) 137 IR 310; [2004] NSWIRComm 353

Morrison v Powercoal Pty Ltd (No 3) (2005) 147 IR 117; [2005] NSWIRComm 61

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

Nash v Silver City Drilling (NSW) Pty Ltd; Attorney General for New South Wales v Silver City Drilling (NSW) Pty Ltd [2017] NSWCCA 96

Orbit Drilling Pty Ltd v The Queen (2012) 35 VR 399; [2012] VSCA 82

R v Cage [2006] NSWCCA 304

R v MA (2004) 145 A Crim R 434; [2004] NSWCCA 92

R v MMK (2006) 164 A Crim R 481; [2006] NSWCCA 272

R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309

R v Youkhana [2004] NSWCCA 412

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

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

Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266

Veen v R (No 2) [1988] HCA 14; (1988) 164 CLR 465

WorkCover Authority of NSW vSarjameStorage Pty Ltd [2015] NSWDC 151

WorkCover Authority (NSW) v Profab Industries Pty Ltd (2000) 49 NSWLR 700; [2000] NSWIRComm 142

Category:

Sentence

Parties:

SafeWork NSW (Prosecutor)
State Asphalt Services Pty Ltd (Defendant)

Representation:

Counsel:
E Kerkyasharian (Prosecutor)
M Cahill (Defendant)

Solicitors:
Department of Customer Services (Prosecutor)
Sparke Helmore (Defendant)

File Number(s):

2023/162659

Publication restriction:

Nil

JUDGMENT

1. State Asphalt Services Pty Ltd (the defendant) entered a plea of guilty to an Amended Summons filed in court on 16 December 2024 for an offence under the Work Health and Safety Act 2011 (WHS Act).

2. The duty that the defendant failed to comply with was with the primary duty of care under s 19(1) of the WHS Act as it failed to comply with a health and safety duty under s 32 of the WHS Act.

3. The particulars of the failures are set out in par 16 of the particulars to the Amended Summons.

4. As a result of these failures, workers were exposed to the risk of serious injury and death by being struck, crushed or run over by moving plant. One worker, Mr Joseph Micallef (the deceased), was in fact struck and died as a result.

5. The maximum penalty for the offence is $1,766,130.

6. The Prosecutor tendered a Prosecution Sentence Tender Bundle (PSTB) which became exhibit A, and a Victim Impact Statement (VIS) from Mrs Carmel Spiteri (Mrs Spiteri) which became exhibit B.

7. The defendant tendered an affidavit of John Kypreos (Mr Kypreos) sworn 5 March 2025 which became exhibit 1 and a supplementary affidavit of Mr Kypreos sworn 10 March 2025 which became exhibit 2. The defendant also tendered an affidavit of Ms Laura Nel (Ms Nel) sworn 5 March 2025 which became exhibit 3, and a supplementary affidavit of Ms Nel sworn 10 March 2025, which became exhibit 4.

Background

8. An Agreed Statement of Facts (ASOF) was filed and can be found behind tab 2 of the PTSB, and the following is a summary thereof.

9. The defendant was the principal contractor for the re-sheeting of the roadway at Railway Parade, Allawah. The offender was part of a group of companies, called the Kypreos Group. Other entities in that group were also engaged on the site, but the offender had “both managerial and on-site supervisory control over the traffic management services” on site, including control over worker on foot protocols.

10. The defendant engaged another company – ANJ Paving Pty Ltd (ANJ) – for the laying of asphalt concrete at the site. ANJ employed the deceased as a labourer and truck driver, as well as for fixing and repairing machinery and equipment.

11. The deceased was fatally struck by being run over by a truck operated by Ausmack Haulage Pty Ltd (Ausmack), a company engaged by another entity within the Kypreos Group.

12. The offender required both Ausmack and ANJ to provide Safe Work Method Statements (SWMSs) in relation to the tasks they were subcontracted to perform. The SWMSs they provided effectively reproduced protocols that the offender had in place on site in relation to workers on foot.

13. However, at the time of the incident, neither the ANJ SWMS nor the Ausmack SWMS were being followed or adequately enforced on site.

14. On the day of the incident, the offender had in place a Worker on Foot Plan for the site.

15. The deceased was killed in the area designated “Truck Clean Out area”. It was the usual practice not to nominate that area as a particular zone for the purposes of the risk management system, and it was not so nominated on the date of the incident.

16. As a result, there was confusion from workers at the site about designation of the area, and consequently what safety measures applied. There was no signage in the area which specified whether workers were or were not permitted to be on foot.

17. The risk management system for workers on foot also included a plan to manage communication between workers on foot and mobile plant. The SWMS did not require that workers in the Truck Clean Out area be supervised by a person with a two-way radio if they did not personally have one, nor did they require that the presence of workers on foot in the zone be clearly communicated to operators of vehicles located in or about the area.

18. The SWMSs were also silent as to processes in the event of a breakdown of plant on site. There was no prohibition on repair works being undertaken in the Truck Clean Out area or any other zone on the site. Nor was there adequate supervision to prevent repairs being undertaken within the zone, which was the usual practice for relatively minor repairs to be conducted on site.

19. On 21 May 2021, the day of the incident, a truck was in the Truck Clean Out area. Whilst the area had signs designating it as that area sometime prior to the incident, at the time of the incident, there were no signs marking it out.

20. Excess asphalt was loaded on to the truck using a bobcat. During this process, a hose on the bobcat burst. A decision was made to repair the hose on site. The bucket of the bobcat was placed in the gutter in front of the truck. There, the deceased began the repairs. He was not instructed to cease repairs despite being in the Truck Clean Out area.

21. Whilst the deceased continued the repairs, there were communications to the effect that the truck was “good to go” by a person who did not identify themselves. Within about one minute, the truck moved forward, crushing and killing the deceased.

Sentencing

22. The court is to approach a sentencing exercise on the basis of it being one of “instinctive synthesis”:  Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25.

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

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

Objective Seriousness of the Offence

24. The primary consideration requires a determination of the objective seriousness of the offence. The High Court made this clear in Muldrock v The Queen (2011) 244 CLR 120; [2011] HCA 39 at [27]:

“…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 offending.”

25. Subjective factors play a subsidiary role:  Lawrenson Diecasting Pty Ltd v WorkCover Authority (NSW) (1999) 90 IR 464 at 474-475.

26. The duties of the defendant require that they ensure the health and safety of workers as far as reasonably practicable. This duty is not delegable, and the duty requires the identification of risks in the workplace and an assessment of measures to address such risks.

27. The gravity of the offence is determined by the extent of the duty holder’s failure to ensure, so far as was reasonably practicable, that its workers were not exposed to risks to their safety:  Orbit Drilling Pty Ltd v The Queen (2012) 35 VR 399; [2012] VSCA 82 at [62] (Maxwell P, Bongiorno JA and Kyrou AJA); Veen v R (No 2) [1988] HCA 14; (1988) 164 CLR 465.

28. The objective degree of foreseeability is a matter for the court to have regard to when considering the gravity of the offence: Capral Aluminium Ltd v WorkCover Authority (NSW) (2000) 49 NSWLR 610; [2000] NSWIRComm 71 (Capral Aluminium) at [81].

29. An offence will be serious where there is an obvious or foreseeable risk to safety against which appropriate measures were not taken even though such measures were available and feasible:  Morrison v Powercoal Pty Ltd (No 3) (2005) 147 IR 117; [2005] NSWIRComm 61.

30. Subjective factors should not be permitted to produce a sentence which fails to adequately reflect the seriousness of the offence: WorkCover Authority (NSW) v Profab Industries Pty Ltd (2000) 49 NSWLR 700; [2000] NSWIRComm 142 at [31].

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

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

32. His Honour further observed at [42]:

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

33. I accept that s 3A of the Crimes (Sentencing Procedure) Act 1999 (Sentencing Act) is generally regarded as a codification of the common law principles of sentencing:  R v MA (2004) 145 A Crim R 434; [2004] NSWCCA 92. The purposes of punishment in the section are constrained by the sentencing principles that exist under the common law such as the principles of proportionality and totality: R v MMK (2006) 164 A Crim R 481; [2006] NSWCCA 272.

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

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

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

1. The potential consequences of the risk. Consequences may range from mild to catastrophic. Offending will be more serious where the potential injuries are severe, regardless of whether they are likely to materialise:  Nash v Silver City Drilling at [34].

2. The availability of steps to eliminate or minimise the risk:  Nash v Silver City Drilling at [34].

3. Whether those steps are complex, burdensome or mildly inconvenient. If mitigating steps could easily have been taken, the offending will be more serious:  Nash v Silver City Drilling at [34] and [53].

4. Whether the risk was known or ought reasonably to have been known to or identified by the offender.

5. Whether the risk was an obvious or clear one.

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

37. However, I accept that it is the risk that I am assessing the seriousness of, and not the manifestation of.  In Nash v Silver City Drilling, his Honour Justice Basten dealt with the proper approach to considering the objective seriousness of offences under the WHS Act, saying at [53]:

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

Matters Relevant to Determining the Culpability of the Defendant

38. In the context of a busy road site, involving multiple entities operating in the vicinity of one another, with heavy plant moving about, the risk of workers on foot being run over is self-evident and self-evidently serious in that it is likely to cause serious injury and death. It is a risk that is well known in the industry, and it was known to the offender.

39. I accept that the offender took steps to plan for the risk, including requiring the production of SWMS by relevant subcontractors, and by having its own systems. I accept that this differentiates the defendant’s failures from the worst case, which would involve absolutely no consideration of the risk.

40. However, the existence of a safety framework, however robust or detailed, is not a matter which reduces risk if that framework is not being enforced, as the ASOF make clear was the case.

41. The failures of the defendant (as set out in par 16 of the particulars attached to the Amended Summons) were not only reasonably practicable, but self-evidently not difficult to implement.

42. By its plea, the defendant concedes that there were steps which, in all the circumstances of the incident:

1. Were reasonably practicable for the defendant to take.

2. Which, if taken by the defendant, would have reduced the subject risk.

43. The defendant acknowledges that it was aware of the risk of a worker being struck by mobile plant, in particular asphalt delivery trucks, operating on road asphalt re-sheeting sites.

44. It was incumbent that the defendant had in place traffic control measures relating to the entry and exit of mobile plant from the site, including asphalt delivery trucks. The control of road traffic and pedestrian movements external to the site due to road closures, were required to enable the road re-sheeting works to proceed.

45. Nonetheless it is an agreed fact that as the principal contractor on the site, the defendant did have in place a detailed safety management system for the works. I accept that this is not a defendant who had no regard for the safety of workers, however the systems in place were not adequately implemented or enforced.

46. The defendant acknowledges that the risk was the risk of workers, including the deceased, suffering serious injury or death as a consequence of being struck, crushed and/or runover over by moving plant.

47. The defendant acknowledges the risk of injury associated with moving plant on construction sites was well known in the industry and specifically identified by the company in its safe work system.

48. I am of the view that the acceptance of these matters is reflected in the company’s acceptance of the Agreed Statement of Facts which acknowledges both:

1. The company’s acceptance of its responsibility for breaching the duty imposed upon it by s 19(1) of the WHS Act.

2. The death of Mr Micallef and also, the injury, loss and damage sustained by the deceased’s family, friends and work colleagues which flowed from the company’s failings.

49. The defendant also acknowledges the existence of guidance materials tendered by the prosecutor.

50. The defendant asserts that it is a small, family owned and operated, specialist asphalt supply and placement company.

51. I do not accept that submission. At par 74 of the defendant’s written submissions it is submitted that the defendant:

“presently employs 68 workers and provides work to about 60 subcontract workers and continues to provide specialist asphalt supply and placement contractor (sic) which services clients such as Transport for NSW, Tier 1 and Tier 2 civil construction companies, a variety of local councils and private construction clients.”

52. Whilst I accept the submission that the defendant is not a large multi-national organisation, to my mind, is not a small family company, but an entity as part of a group of related companies which employs significant numbers of workers and utilises many subcontractors.

53. I accept that the defendant has taken significant steps after the incident, to review existing policies, and develop better ways to ensure safety of workers employed or subcontracted by the defendant.

52. It is submitted that the matters set out above are matters which the court may take into account in determining the extent, if any, to which specific deterrence is required, but also the relevance of the size of the offending entity. As was observed in Nash v Silver City Drilling (NSW) Pty Ltd at [59]:

“Secondly, it is possible to be satisfied in the case of a small corporation that changes in management practice may diminish significantly the need for individual deterrence. That may not be so powerful a factor with a large corporation which will rely upon general systems and the quality and diligence of its supervisory officers.”

55. With regard to this aspect of the case, the defendant submits:

“Having regard to the size of the corporation, the personal commitment of Mr John Kypreos to driving better safety outcomes, the evidence of Mr Kypreos and Ms Nel to rectification of the defects in the company’s systems and the introduction of an ongoing cultural change program designed to achieve ongoing safety, the Court may be comfortably satisfied that there is a real and meaningful commitment by management which will significantly reduce the risk of future offending.”

56. It is difficult to understand how the defendant can assert that it is a small family company based on pars 10-13 of its own written submissions which states:

“9. SAS is a small, ‘family-owned’ and managed, construction company specialising in the construction, maintenance and repair of roads and related infrastructure and in particular in the placement, maintenance, repair and replacement of asphalt road surfaces. [Kypreos [24]-[31]]

10. SAS is a member of a family-owned and operated group of companies, the Kypreos Group of companies. The Kypreos Group is owned and operated on behalf of the Kypreos family by Mr John Kypreos, the managing director of SAS, Mr John Kypreos’s two brothers and his father, Mr George Kypreos. [Kypreos [24]-[31].]

11. In combination with other members of the Kypreos Group including Atlas Traffic Management Pty Ltd (Atlas), and, also, some external specialist asphalt contractors, SAS provides a variety of road construction, maintenance and repair services, such as road profiling; asphalt paving; spraying and sealing of road surfaces; and related transport/cartage services. [Kypreos [24]-[31]]

12. SAS was established in 2001. [Kypreos [24]]

13. SAS presently employs 68 workers and provides subcontract work to approximately 60 subcontract workers.”

57. As previously stated, I do not accept that the defendant is a small company, and ought not to be afforded some leniency on that basis.

Victim Impact Statement

58. Mrs Spiteri, the sister of the deceased provided a Victim Impact Statement dated 11 February 2025 which became exhibit B.

59. The VIS was very hard to read as it set out so eloquently, the suffering that the deceased’s extended family have suffered. The deceased’s father was in the early stages of ill health at the time of the incident, and when he passed away, there had been no conclusion to the proceedings into the deceased’s death. His mother could not write a statement as she remains too distressed to do so, which is understandable.

60. The deceased’s wife and son have moved to the USA to try and find a different life and to try and avoid the heartache, again very understandable.

61. Mrs Spiteri and her husband have had to become the family’s representatives which has been incredibly exhausting, draining and distressing, which again is completely understandable. The strength that Mrs Spiteri has shown in making the statement is amazing and commendable, and I feel honoured to have had the opportunity to read it. The family have been left devastated. I pass my deepest condolences to all of the family for their loss and resulting heartache and sorrow.

62. A strong theme in the VIS, however, is the increased distress that the family have had to suffer due to the delay in a conclusion to the legal proceedings, is another matter for which I am so deeply sorry to the extent that some of such delay has been my responsibility. When one considers that the incident occurred on 21 May 2021, and the sentencing hearing came before me on 12 March 2025, it is apparent that such delay has exacerbated the family’s suffering, as they needed to know the cause of the incident that led to the loss of a beloved son, brother, husband and father.

Aggravating Factors

63. For the purposes of s 23A(2)(g) of the Sentencing Act, the sole aggravating factor to be taken into account is the death of Mr Micallef.

64. The injury, emotional harm, loss or damage caused by the offence was substantial: s 21A(2)(g) of the Sentencing Act. In order for this 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] (Hidden J, McColl JA and Levine J agreeing). The injury and damage caused by the offence was substantial as it resulted in the death of the deceased.

65. I am satisfied beyond reasonable doubt that this harm is more deleterious than may ordinarily be expected, and as such is an aggravating factor pursuant to s 21A(2)(b) of the Sentencing Act.

Mitigating Factors

66. In Haynes v CI & D Manufacturing Pty Limited (No 2); Callaghan v CI & D Industries Pty Limited (No 2) (1995) 60 IR 455 at 456-457 the Full Bench held the following:

“We think that having regard to the specific nature of the legislation, the past record upon which the both the prosecution and the defendants should rely must be intimately bound to the nature of the offences which the Court is considering, namely industrial safety, health and welfare. We add one comment on the question of the previous record, and that is that the Court should attempt to ensure the accuracy of the record and have objective regard to it in relation to the industrial enterprise and the extent of its operations. We consider that the extent of the operations of the defendant enterprises is to be taken into consideration when coming to conclusions having regard to the past record.

Human experience indicates that the larger the number of industrial transactions a company is involved in the larger the number of industrial accidents which occur as a matter of statistical expectation. The safety record of very large company with some prior convictions may, on analysis, be better than that of a small company with fewer such convictions. However, we again emphasise that in the context of the OHS Act the record is only one of the factors to be taken into account in assessing penalty and the essential inquiry must remain the circumstances of the breach in question.”

67. The defendant has never been subject to a prior conviction under work, health and safety law: s 21A(3)(e) of the Sentencing Act, and as such is entitled to the leniency on that basis.

68. I accept that the defendant is a corporate citizen of good character: s 21A(3)(f) of the Sentencing Act.

69. I accept that the defendant is unlikely to reoffend as it has undertaken significant changes and is even more focused than before on the health and safety of its workers: s 21A(3)(g) of the Sentencing Act. This is not a defendant that had no regard to safety at all – it had systems in place to protect its workers, but there was unsatisfactory implementation and enforcement of such policies at the workplace.

70. I accept that the defendant has demonstrated a very strong commitment to workplace safety, and therefore has very good prospects of rehabilitation: s 21A(3)(h) of the Sentencing Act.

71. I accept that the defendant has demonstrated its remorse and accepted responsibility for the offence: s 21A(3)(i) of the Sentencing Act.

72. The defendant co-operated with SafeWork NSW during its investigations: s 21A(3)(m) of the Sentencing Act.

73. The defendant entered a plea of guilty to the Amended Summons at an early stage of the proceedings. Such a plea of guilty demonstrates remorse, and I will allow a deduction of 25% for the utilitarian value of the plea in accordance with the principles set out in R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309 and s 21A(3)(k) and s 22 of the Sentencing Act.

Capacity to Pay

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

“6 Consideration of an accused's means to pay

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

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

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

75. The onus is on the offender to satisfy the court on the balance of probabilities as to the truth of such evidence and its relevance to the fixing of penalty:  McColl v John Watson Building Services Pty Ltd (2004) 137 IR 310; [2004] NSWIRComm 353 at [24].

76. The offender’s capacity to pay is relevant but not decisive:  Jahandideh v R [2014] NSWCCA 178 at [16] (Rothman J, Hoeben CJ at CL agreeing).

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

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

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

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

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

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

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

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

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

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

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

78. 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.”

79. The defendant has not made an application under s 6 of the Fines Act.

Costs

80. The issuing of costs against a defendant in both criminal and civil proceedings is not punitive, but rather compensatory to the prosecution:  Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534 at 543 (Mason CJ).

81. However, given the objective seriousness of the offending and the requirement for general deterrence, the fine must be such that it satisfies all of the relevant considerations.

82. The court is entitled to take into account the fact that the defendant will be liable to pay the prosecutor’s costs when considering any monetary penalty to be imposed on the defendant, particularly in circumstances where there is evidence of a limited capacity to pay a fine, and I have done so.  Costs payable to the prosecutor are the “normal” rule as the prosecutor has been successful, although there can be exceptions: see for example,  Bulga Underground Operations Pty Ltd v Nash (2016) 93 NSWLR 338; [2016] NSWCCA 37.

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

Penalty

84. I make the following orders:

1. The defendant is convicted.

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

3. Accordingly, the defendant is to pay a fine of $450,000.

4. Pursuant to s 122(2) of the Fines Act 1996 (NSW), 50% of the fine imposed is to be paid to the prosecutor.

5. Pursuant to s 257B of the Criminal Procedure Act 1986 (NSW), the defendant is to pay the prosecutor's costs, as agreed or assessed.

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Decision last updated: 21 March 2025