WorkCover Authority of NSW v Plumbwizard Pty Limited and John Georges

[2015] NSWDC 266

District Court

New South Wales

Medium Neutral Citation:	WorkCover Authority of NSW v Plumbwizard Pty Limited and John Georges [2015] NSWDC 266
Hearing dates:	4 March 2015
Date of orders:	06 March 2015
Decision date:	06 March 2015
Jurisdiction:	Criminal
Before:	Kearns DCJ
Decision:	Plumbwizard Pty Ltd: I find Plumbwizard Pty Ltd guilty and it is convicted of the charge. I impose a fine of $60,000 with a moity to the prosecutor. The defendant is to pay the prosecutor’s costs in an agreed sum of $10,000. Mr Georges: Mr Georges is found guilty and is convicted of the offence charged. I impose a penalty of $8,500 with a moity to the prosecutor. Mr Georges is to pay the prosecutor’s costs in an agreed sum of $25,000.
Catchwords:	Work Health and Safety Act 2011 ss 19(1), 32, 27(1) – worker fell through opening on first floor balcony of construction – serious injury – duty of employer to ensure health and safety of workers – failure exposed worker to risk of death or serious injury – duty of officer to exercise due diligence to ensure company complied with duty – failure to provide construction induction training to worker – failure to appropriately cover or barricade the opening or to warn of its danger – foreseeability of risk – preventability of risk – general deterrence – no prior adverse safety incidents – contrition and remorse – discount for early guilty plea – consideration of principle of parity – consideration of totality of fine approach – ability to pay – victim impact statement
Legislation Cited:	Work Health and Safety Act 2011; Crimes (Sentencing Procedure) Act 1999
Category:	Sentence
Parties:	WorkCover Authority of NSW (Prosecutor) Plumbwizard Pty Limited and John Georges (Defendant)
Representation:	Counsel: Mr I Taylor SC with Ms P McEniery appeared for the prosecutor Mr P Kintominas appeared for the defendants
File Number(s):	13/371364; 13/371380

Judgment

THE CHARGES AND PLEAS

1. Plumbwizard Pty Ltd is charged that on 20 June 2012, being a person conducting a business or undertaking, who had a health and safety duty under s 19(1) of the Work Health and Safety Act 2011 to ensure, so far as is reasonably practicable, the health and safety of workers, while the workers were at work in the undertaking, did fail to comply with that duty. That failure exposed Daniel Keigaldie Gogtapeh to a risk of death or serious injury contrary to s 32 of the Act. Plumbwizard has pleaded guilty to the charge.

2. Mr John Georges is charged that on 20 June 2012, being an officer who had a health and safety duty under s 27(1) of the Work Health and Safety Act 2011 to exercise due diligence to ensure that Plumbwizard complied with its duty under s 19(1) of the Act, failed to comply with his duty and thereby exposed Daniel Keigaldie Gogtapeh to a risk or death or serious injury contrary to s 32 of the Act.

THE LEGISLATION

3. Section 19(1) of the Act provides:

“A person conducting a business or undertaking must ensure, so far as is reasonably practicable, the health and safety of:

(a) workers engaged, or caused to be engaged by the person, and

(b) workers whose activities in carrying out work are influenced or directed by the person,

while the workers are at work in the business or undertaking.”

4. Section 27(1) provides:

“If a person conducting a business or undertaking has a duty or obligation under this Act, an officer of the person conducting the business or undertaking must exercise due diligence to ensure that the person conducting the business or undertaking complies with that duty or obligation.”

5. Section 32 provides:

“A person commits a Category 2 offence if:

(a) the person has a health and safety duty, and

(b) the person fails to comply with that duty, and

(c) the failure exposes an individual to a risk of death or serious injury or illness.

Maximum penalty:

(a) in the case of an offence committed by an individual (other than as a person conducting a business or undertaking or as an officer of a person conducting a business or undertaking)—$150,000, or

(b) in the case of an offence committed by an individual as a person conducting a business or undertaking or as an officer of a person conducting a business or undertaking—$300,000, or

(c) in the case of an offence committed by a body corporate—$1,500,000.”

THE FACTS

6. Daniel Gogtapeh, more commonly called Daniel Keigaldie, was injured on 20 June 2012 when he fell through an opening on a first floor balcony of a duplex being constructed at 26 Webb Street, Merrylands. There were earlier proceedings in respect of the same incident brought against Mr El-Hayek, the owner of the premises on which the duplex was being constructed. Much of the factual detail concerning that incident is set out in the sentencing remarks on the plea in those proceedings (WorkCover Authority of New South Wales v El-Hayek [2014] NSWDC 362). There is no need to repeat much of the detail.

7. There is a significant difference between the El-Hayek proceedings and these proceedings and that lies in the relationship between the parties. Here Daniel was an employee of Plumbwizard.

8. On 20 June 2012 Plumbwizard was present on the construction site through its director, John Georges. Also present were subcontractors to Plumbwizard, being Peter Georges, Samir Georges and Joseph Yanco. Peter Georges was working as the supervisor and the other two were working as plumbers. Daniel was working as a labourer.

9. 20 June 2012 was Daniel’s first or second day on the construction site. He was only 16 years of age. He was employed as an apprentice plumber by Plumbwizard. He had been employed by Plumbwizard for only about three weeks. He was allocated work on the first floor of the construction. On that level was a balcony for each of the duplexes. Each balcony had a penetration in it. At times the penetration in the balcony was covered by a timber pallet. Sometimes it was not covered at all. The timber pallets that covered the penetration could easily be moved.

10. Before the incident Daniel had not received from Plumbwizard or from anybody any training or instruction in safety. He had not received the mandated construction induction training. He did not hold a construction induction card. He was not trained or inducted into any of Plumbwizard’s safety systems and had not received specific induction. He was not provided with, and did not see, any safe work method statements from Plumbwizard.

11. Mr Georges was the sole shareholder and director of Plumbwizard. Up to the time of the incident Mr Georges had spent about 17 years working as a plumber. Until about seven years ago he had been in partnership with a family member. Work became scarce. Business languished. Mr Georges suffered financial hardship and had to sell the family home to pay his debts.

THE PARTICULARS

12. The particulars of the risk are described in the summons. They may be summarised as follows. In the case of both defendants, the particulars of the risk describe the risk as the risk of Daniel being seriously injured as a result of a fall through the penetration.

13. Particulars of the measures available to Plumbwizard to employ include the use of warning signs, induction training going to the presence and risk of the penetration, securing the penetration with an appropriate cover and barricading the penetration.

14. As to Mr Georges, the particulars against him allege in brief that he failed to ensure that Plumbwizard implemented the measures available to it.

THE SENTENCING

15. I need to bear in mind several matters. I need to bear in mind the purposes of sentencing as enumerated in s 3A of the Crimes (Sentencing Procedure) Act. I need to bear in mind the purposes of the Work Health and Safety Legislation, in particular ensuring the safety, health and welfare of workers and others on workplace premises. I need to bear in mind any relevant aggravating and mitigating factors, including any mentioned in s 21A of the Crimes (Sentencing Procedure) Act so far as any of those may be relevant.

16. I start my analysis with a consideration of the gravity of the offence. This is determined in part by the foreseeability of the risk of injury, the foreseeability of the consequences of the risk coming home and the measures available to avoid the risk.

17. As to foreseeability, injuries on building sites are notorious. So are injuries resulting from falls from or through roofs, ceilings, scaffoldings and ladders. There was a penetration in the balcony at the worksite where Daniel was working and this was known to the defendants. It was also known to the defendants that the penetration was not securely covered or otherwise made safe. The foreseeability of injury was high on the scale of probability.

18. Foreseeability of serious injury was also high on the scale of probability. The risk here was of a fall of about 3 metres on to a hard concrete surface. Depending on how the fall occurred, it could have resulted in injuries ranging from relatively minor to most serious.

19. There were simple measures available to the defendants to obviate the risk and prevent injury. They included training and induction of Daniel in matters of safety, induction into safety systems such as safe work method statements and site induction. More specifically they included securing the wooden pallets or other form of covering over the penetration in the balcony so no‑one could fall through or placing a secure barrier around it.

20. Also relevant on the gravity of the offence is the relationship with Daniel. It was that of employer and employee so far as Plumbwizard was concerned. The common law imposes a duty of care on employers to take reasonable steps to ensure the safety of their employees. In this employment relationship it is a high standard that is expected and that is especially so in the industrial workplace and on construction sites. Emphasis is added to that in this case by reason of the age and inexperience of Daniel. In the above context the defendants did nothing to protect Daniel.

21. I turn to deterrence. I do not think specific deterrence looms large in this case. This is because the defendants have taken significant measures to ensure no further workplace accidents occur. Immediately following the accident the defendants hired a safety officer. On every task now he goes onsite for a safety inspection and assessment. Plumbwizard now has in place an extensive safe work method statement.

22. General deterrence remains a factor. People operating in the construction industry must be aware, and made aware of the need for safety. They must know that there can be harsh penalties applied for their lack of awareness and lack of attention to safety.

23. I bear in mind the maximum penalty in this case is $1,500,000 in the case of Plumbwizard and $300,000 in the case of Mr Georges. I note however that the maximum can be applied only in the most extreme of cases.

24. There are significant subjective matters I need to bear in mind, Plumbwizard has had only a short life, having been registered on 3 March 2011. In that time it has had no safety incident. Mr Georges has been in the business for 17 years and in that time has not had any other adverse safety incident. Plumbwizard has established itself as a contributor to its local community particularly through its contribution to junior rugby league.

25. The prospects of the defendant’s reoffending are extremely low especially for reasons set out dealing with specific deterrence.

26. The defendants have expressed contrition and remorse. This is genuine. It was demonstrated by actions of Mr Georges immediately following the incident. He immediately attended to Daniel when he was injured. He travelled with him in the ambulance to hospital. He visited him in hospital after that. Plumbwizard kept Daniel’s job open for him and was prepared to accommodate him at work on light duties. Daniel’s father did not want him to return to work with Plumbwizard. That is understandable, but it does not diminish the level of concern and interest that the defendants were showing in the welfare of Daniel.

27. Plumbwizard entered a plea of guilty at an early stage and is entitled to the benefit of a 25% discount on the amount of fine otherwise to be imposed.

28. Mr Georges entered a plea of guilty, but it was relatively late. It was after the matter had been mentioned in court several times, it was after the matter had been listed for a contested hearing. Nevertheless, there was a plea in the end though its utilitarian value is diminished compared to an early plea.

29. I think an appropriate discount to allow in the case of Mr Georges is 15%.

30. Mr Kintominas, who appeared for the defendants, submitted that I should apply the principle of parity and relate the penalty to that which I applied in the proceedings against Mr El-Hayek. I do not agree. If there is any parity it is most tenuous. Mr El-Hayek was a land owner wishing to build a residence on his property for his own occupation. Despite a cursory building course undertaken by him, he had no knowledge or experience at all in building work. He contracted for the work to be done by others. This was his only venture into building work and chastened by experience he had no intention of ever undertaking such an exercise again. Further, there was no relationship at common law of the kind that existed here between Plumbwizard and Daniel.

31. The essential cause of the incident in this case was Plumbwizard’s failure in measures already mentioned and Mr Georges’ failure to ensure that Plumbwizard took those measures. The moral burden for the incident lies essentially with the defendants.

32. Mr Kintominas also submitted that I should take a totality of fine approach. Again I do not agree. I accept that the real source for the funds to pay any fine and cost will be Mr Georges. That is not sufficient to support the submission. It is true that if there were no company there would be only one set of proceedings and one fine. It is Mr Georges’s choice, however, to operate through a company. That has consequences, some potentially beneficial and some potentially detrimental.

33. Potentially beneficial consequences include treatment of income for tax purposes and perhaps some relief from personal liability. Potentially detrimental consequences include situations such as the present.

34. Mr Georges has chosen to operate the way he has. It exposes two legal persons to two different obligations under the Work Health and Safety Act and to consequences for breach of those obligations. That is the position as I see it at law. That however does not mean I cannot take into account that when it comes to imposing a penalty on Mr Georges, the fact that the company will already have been fined, that is a fine that in real terms he will have to pay himself. It was common ground that he has guaranteed the company’s payment of fine and costs in this case.

35. Mr Kintominas also made submissions as to the defendants’ ability to pay. Plumbwizard’s profit and loss statements revealed that it made losses in the financial years ending 30 June 2013 and 30 June 2014. They were about $45,000 and $124,000 respectively. Mr Georges’ income-tax returns for the years ended 30 June 2012, 30 June 2013 and 2014 reveal taxable income of approximately $53,000, $36,000 and $71,000 respectively.

36. Mr Georges is married with children. His wife owns the house in which they live. He says it is valued at about $650,000. There is an outstanding mortgage of about $400,000. His wife works and she pays off the mortgage. When he can he makes some contributions to the mortgage payments.

37. Mr Georges has about $14,000 in personal savings accumulated over about 12 months. He has no other investments or assets.

38. Mr Georges is keen to keep Plumbwizard going. He had a near bankruptcy experience six to seven years ago and had to sell his house to pay out his creditors. He does not wish to experience bankruptcy.

39. Mr Georges says that he, I assume by this he means Plumbwizard, will be commencing large jobs for two builders, presumably soon and both have agreed to make advanced payments to assist to cover any fine and legal costs. This is a resource I take into account. Mr Kintominas submitted Mr Georges will have to pay tax on that. That may not be so. If it is Plumbwizard that is to do the jobs it will presumably be the recipient of the advances and its profit and loss statements would suggest it will in all likelihood not be paying tax.

40. I note also another resource available to the defendants and that is to borrow. I take into account the additional cost that would be associated with that.

41. There can be little social utility in imposing a fine that would cripple the defendants and effectively put them out of business with such flow on effects as that might have and I keep that in mind and shall try to avoid that consequence.

42. I have been referred to a number of cases where penalties have been imposed for offences of a kind similar to the one in this case. I do find those cases helpful. The assistance however is of limited value because of the vastly different circumstances between this case and those cases. It is not necessary to enumerate those differences. Two are of some significance. One is that all the cases I was referred to were under the Occupational Health and Safety Act, where the penalty was considerably lower than the maximum penalty now applicable. On the other hand none of the cases involved consideration of any relief under the Fines Act. One of the cases had some evidence about the financial resources of the defendant but there was no application in that case for any relief under the Fines Act and hence the purpose of that evidence is quite puzzling. In the end it was not taken into account.

THE VICTIM’S STATEMENT

43. Daniel has provided a victim’s statement. I do not use it in assessing penalty. I do note, however, the dark and troubled times he went through following the incident and its ongoing effects on him. Whilst there was no intention by anyone to harm him, he was entitled to expect better and with proper care for his safety he should not and would not have been through the difficult times he has undergone. It is refreshing that though he sees it as a challenge he does seek a brighter future.

THE RESULT

44. Taking all these matters into account, with the exception of the victim’s statement, I think an appropriate fine in the circumstances is in the case of Plumbwizard, before discount, the sum of $80,000. With the full discount of 25% for an early plea, the fine will then be $60,000.

45. In the case of Mr Georges I propose a fine of $10,000 with a discount of 15% for his plea, so that the fine in his case will be $8,500.

ORDERS

Plumbwizard Pty Ltd:

46. I find Plumbwizard Pty Ltd guilty and it is convicted of the charge.

47. I impose a fine of $60,000 with a moity to the prosecutor.

48. The defendant is to pay the prosecutor’s costs in an agreed sum of $10,000.

Mr Georges:

49. Mr Georges is found guilty and is convicted of the offence charged.

50. I impose a penalty of $8,500 with a moity to the prosecutor.

51. Mr Georges is to pay the prosecutor’s costs in an agreed sum of $25,000.

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Decision last updated: 12 November 2015