District Court New South Wales Medium Neutral Citation: R v EK Fabrication Pty Limited; R v Rafayel El-Khoury [2020] NSWDC 679 Hearing dates: 1 October 2020 Date of orders: 6 November 2020 Decision date: 06 November 2020 Jurisdiction: Criminal Before: Strathdee DCJ Decision: (1) The defendants are convicted. (2) The appropriate fine for EK Fabrication Pty Limited is $240,000.00 and that will be reduced by 25% to reflect a plea of guilty. (3) Accordingly, I order EK Fabrication Pty Limited pay a fine of $180,000.00. (4) The appropriate fine for Rafayel El-Khoury is $20,000.00 and that will be reduced by 25% to reflect the early plea. (5) Accordingly, I order Rafayel El-Khoury pay a fine of $15,000.00. (6) Pursuant to s 122 (2) of the Fines Act 1996 (NSW), 50% of the fines imposed are to be paid to the prosecutor. (7) I make no order as to costs. Catchwords: CRIME – prosecution – work, health and safety – duty of persons undertaking business – duty of employers – risk of death or serious injury – worker injured FINES – capacity of defendant to pay fines – defendant to demonstrate incapacity SENTENCING – discount for utility of the plea – remorse - contrition Legislation Cited: Crimes (Sentencing Procedure) Act 1999 (NSW) Fines Act 1996 (NSW) Work Health and Safety Act 2011 (NSW) Work Health and Safety Regulations 2011 (Cth) Cases Cited: Bulga Underground Operations v Nash [2016] NSWCCA 37; (2016) NSWLR 338 Capral Aluminium Limited v WorkCover Authority of NSW [2000] NSWIRComm 71; (2000) 49 NSWLR 610 Environmental Protection Authority v Barnes [2006] NSWCCA 246 Fisher v Samaras Industries Pty Ltd (1996) 82 IR 384 Inspector Beacham v J & L Marble Pty Ltd [2009] NSWIRComm 100 Inspector Howard v Baulderstone Hornibrook Pty Ltd [2009] NSWIRComm 92 Jahandideh v R [2014] NSWCCA 178 Kirk v Industrial Commission of New South Wales [2010] HCA 1 Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (1999) 90 IR 464 Markarian v The Queen (2005) 228 CLR 357 McColl v John Watson Building Services Pty Ltd [2004] NSWIR Comm 353; (2004) 137 IR 310 Morrison v Powercoal Pty Limited & Anor (No.3) [2005] NSWIRComm 61 Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96 Orbit Drilling v The Queen; Smith v The Queen [2012] VSCA 82 R v Cage [2006] NSWCCA 304 R v Miria [2009] NSWCCA 68 SafeWork NSW v Emu Group Pty Limited [2019] NSWDC 537 SafeWork NSW v HCM Building Pty Limited [2019] NSWDC 632 Veen v R (No. 2) (1988) 164 CLR 465 WorkCover Authority (NSW) v Profab Industries Pty Ltd (2000) 49 NSWLR 700 Texts Cited: SafeWork Australia: Construction work – steel erection information sheet (January 2016) Category: Sentence Parties: SafeWork NSW (Prosecutor) EK Fabrication Pty Limited (Defendant) Rafayel El-Khoury (Defendant) Representation: Counsel: Ms Lee (for the Prosecutor) Mr C O'Neill (for the Defendants) Solicitors: Mr Rhys Wilkins, SafeWork NSW, Department of Customer Service (for the Prosecutor) Mr Christopher Habra, Centurion Lawyers (for the Defendants File Number(s): 2019/00083689 SafeWork NSW v EK Fabrication Pty Ltd 2019/00083588 SafeWork NSW v Rafayel El-Khoury Judgment 1. On 21 July 2020, EK Fabrication Pty Limited ('EK Fabrication') pleaded guilty to an offence contrary to s 32 of the Work Health and Safety Act 2011 (NSW) ('the Act') that, by failing to comply with the health and safety duty imposed upon it by s 19(1) of the Act, it exposed Mr Jason Snape to a risk of death or serious injury. The offence carries the maximum penalty of $1,500,000.00. 2. On 21 July 2020, Mr Rafayel El-Khoury ('Rafayel El-Khoury') pleaded guilty to an offence contrary to s 32 of the Act that, as an officer of EK Fabrication, he failed to comply with the health and safety duty imposed upon him by s 27(1) of the Act, and in doing so, exposed Mr Jason Snape ('Mr Snape') to a risk of death or serious injury. The offence carries the maximum penalty of $300,000.00. 3. Both contraventions arise from an incident on 17 March 2017 involving an employee of EK Fabrication, Mr Jason Snape. The Amended Summons and Statement of Agreed Facts filed 20 July 2020, as well as a bundle of documents tendered by the prosecution (Exhibit A), form the basis of the background of the incident set out below. Background 1. EK Fabrication (ACN 606 922 605) is a person conducting a business or undertaking ('PCBU') primarily in the fabrication and installation of structural steel beams for the construction industry. Ms Noelle El-Khoury is the sole director of the company. 2. Rafayel El-Khoury is employed as the site supervisor for EK Fabrication, a position which he held in March 2017. He is also a person who makes, or participates in making, decisions that affect the whole or a substantial part of the business of the company. 3. In February 2016, EK Fabrication was engaged by ADCO Constructions Pty Limited (ACN 001 044 391) ('ADCO') to install structural steel beams at the construction site of a residential complex situated at 6 Fairway Drive, Kellyville in the State of New South Wales ('the worksite'). ADCO was the principal contractor for the design and construction of the residential complex, and Mr Robert Frame ('Mr Frame') was employed by ADCO as the site supervisor and trade coordinator for ADCO at the worksite. The worksite was a workplace for the purposes of s 8 of the Act. 4. On 26 February 2016, Rafayel El-Khoury signed the contract on behalf of EK Fabrication by which ADCO engaged EK Fabrication to undertake work at the worksite. Rafayel El-Khoury was the point of contact between ADCO and EK Fabrication at the worksite and determined what work was to be done and how that work was to be done. Rafayel El-Khoury also made decisions about who to employ or engage to do work on behalf of EK Fabrication. 5. EK Fabrication employed Mr Hanna El-Khoury (brother of Rafayel El-Khoury) ('Hanna El-Khoury'), as foreman/supervisor for EK Fabrication at the worksite. Hanna El-Khoury was previously an apprentice boilermaker and is a licensed and qualified rigger and dogman. Hanna El-Khoury had approximately 13 months' experience as a supervisor before the date of the incident although he held no formal supervisory training or qualifications. He was initially hired by Rafayel El-Khoury to be a steel rigger and then was engaged to be the foreman/supervisor for EK Fabrication at the worksite. 6. Mr Snape was employed by EK Fabrication as a general hand/labourer at the worksite. THE INCIDENT 1. On 25 February 2016, EK Fabrication started work at the worksite. The work involved the manufacturing and fabrication of structural steel beams (including welding work), installing the manufactured and fabricated structural steel beams and installing structural steel bracing. After the daily toolbox talks were held, cranes were brought onto the site to assist with the installation of structural steel beams on an as-needed basis. 2. On Friday 27 March 2017, at approximately 7:00am, Mr Frame conducted a toolbox talk with Hanna El-Khoury regarding the installation of structural steel beams. Rafayel El-Khoury had access to a copy of the structural drawings which indicated which beams were due to be installed. Mr Frame informed Hanna El-Khoury that a crane would be arriving on the next work day, Monday 20 March 2017, to assist in lifting structural steel beams into place. 3. Hanna El-Khoury then held an informal toolbox talk with Mr Snape and another EK Fabrication employee. Rafayel El-Khoury and Mr Frame were not present at this meeting. During this meeting Hanna El-Khoury told the workers that the job was behind schedule and that EK Fabrication was under pressure to complete the job. Hanna El-Khoury then instructed the workers to install a structural steel beam and not wait for the crane to arrive. 4. The structural steel beam to be installed was approximately 8.134 metres in length and weighed approximately 119.4kg ('the steel beam'). EK Fabrication had a Safe Work Method Statement ('SWMS') Work Activity 3: Erect Structural Steel which refers to the use of cranes in relation to the movement and erection of structural steel. Hanna El-Khoury instructed the workers to lift the steel beam by hand and not wait for the crane. The weather on 27 March 2017 was wet and rainy. 5. The steel beam was required to be moved into position and then lifted up to roof height and bolted into place. Mr Snape, upon seeing the steel beam, informed Hanna El-Khoury that it would be too heavy to lift by hand. Despite this, Hanna El-Khoury instructed Mr Snape and the other worker to begin moving the steel beam into place by hand. The workers subsequently began to drag the steel beam along the ground to the location where it was to be lifted and put into place. 6. Mr Snape informed Hanna El-Khoury that it would be better to use a crane to lift the steel beam into place as it was too heavy to lift by hand. Hanna El-Khoury told Mr Snape that a crane was not required and decided to use a 'Genie Superlift Contractor' mechanical lift ('Genie lift') to assist with lifting the steel beam into place. 7. The Genie lift consisted of two legs on castor wheels supporting a mast. Protruding from the mast were two forks (similar to the tynes of a forklift) upon which objects could be placed and then lowered or raised by use of a hand-wound winch-and-cable system. 8. Hanna El-Khoury retrieved the Genie lift and assisted the workers to drag the steel beam towards the Genie lift and then to lift the steel beam and place onto the forks of the Genie lift. The forks of the Genie lift were then lifted approximately 3.6 metres into the air with the steel beam positioned on top of the forks. 9. Hanna El-Khoury and Mr Snape placed two ladders at each end of the steel beam. Hanna El-Khoury and Mr Snape climbed the ladders and lifted their respective ends of the steel beam in order to begin securing it into place. During the lift, the steel beam became unstable and Hanna El-Khoury dropped his end of the structural steel beam, causing it to fall and place all the weight of the steel beam onto Mr Snape's shoulder. Mr Snape could not sustain the weight of the steel beam and fell approximately 3 metres from the ladder onto the concrete floor. 10. Mr Snape sustained a serious injury, being an acute wedge fracture of the T8 vertebrae (33% loss of anterior vertebral body height). Mr Snape has been unable to return to work. SYSTEMS OF WORK PRIOR TO THE INCIDENT 1. EK Fabrication had a number of documented SWMS for the worksite which were provided to ADCO on 4 August 2016 and approved by Mr Michael Dijkistra, ADCO's Safety Advisor. EK Fabrication was subsequently permitted to work at the worksite and ADCO inducted workers, including Hanna El-Khoury and Mr Snape, with the EK Fabrication SWMS. 2. The SWMS were issued in relation to various work activities including loading and unloading structural steel, erecting structural steel, and the operation of a Genie lift. A copy of EK Fabrication' SWMS 'Work Activity 3: Erect Structural Steel' dated 1 August 2016 is included in the Prosecutor's Tender Bundle (Exhibit A). The SWMS identifies a number of risks including weather conditions, inadequate training/planning, slips, trip and falls, fall from heights while rigging, falling loads/equipment, and manual handling injuries. Control measures are listed for each risk, and include monitoring weather conditions, limiting load lifting to 20kg per person, not carrying loads on slippery or excessively sloped surfaces and using mechanical aids to unload structural steel. 3. The SWMS also refers to the use of a crane as a control to reduce some risks. Hanna El-Khoury is listed as the control person on the SWMS. A copy of the sign off sheet relating to Work Activity 3 shows that both Hanna El-Khoury and Mr Snape were inducted into the SWMS on 11 August 2016 and 8 March 2017 respectively. SYSTEMS OF WORK FOLLOWING THE INCIDENT 1. Following the incident, ADCO suspended work in the area in which the incident occurred. 2. EK Fabrication updated its SWMS to expressly exclude the use of Genie lifts in installing structural steel beams in response to an Improvement Notice issued by SafeWork NSW. LEGAL OBLIGATIONS AND GUIDANCE MATERIAL 1. EK Fabrication held a primary duty of care for Mr Snape pursuant to s 19(1) of the Act, which states as follows: '19 Primary duty of care (1) 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.' 1. Rafayel El-Khoury, as an officer of EK Fabrication, held a duty pursuant to s 27(1) of the Act, which states as follows: '27 Duty of officers (1) 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.' 1. EK Fabrication also held legal obligations under the Work Health and Safety Regulations 2011 (Cth) ('the Regulations'), Clause 34 and 35 of which read as follows: '34 Duty to identify hazards A duty holder, in managing risks to health and safety, must identify reasonably foreseeable hazards that could give rise to risks to health and safety. 35 Managing risks to health and safety A duty holder, in managing risks to health and safety, must: 1. eliminate risks to health and safety so far as is reasonably practicable; and 2. if it is not reasonably practicable to eliminate risks to health and safety—minimise those risks so far as is reasonably practicable.' 1. Guidance materials that were available at the time of the incident provided advice in respect to working with and installing structural steel beams, which were readily accessible and available in the public domain. Such guidance material included SafeWork Australia: Construction work – steel erection information sheet (January 2016) ('Steel Erection Sheet'). The Steel Erection Sheet provides advice on managing risks associated with carrying out steel erection work, outlining that steel erection work can be high risk construction work when it involves the risk of a person falling more than two metres and/or structural alterations or repairs requiring temporary support to prevent collapse. The Steel Erection Sheet also states that cranes require safe systems and methods of work, with different cranes being fit for different purposes. For example, the Steel Erection Sheet recommends using articulating truck-type cranes for positioning smaller or lighter pieces of steel, larger mobile cranes for positioning heavier components requiring further reach and tower cranes for high-rise steel construction. 2. The Genie Operator's Manual (February 2009) ('the Manual') for the Genie lift was also available at the time of the incident. The Manual provided safety and usage guidance for the Genie lift, including the following: * The Manual identifies a number of possible hazards associated with the use of the Genie lift, including crushing hazards, fall hazards, and improper use hazards (pages 2-4) and recommends pre-use equipment and workplace inspections be undertaken (pages 7-13). Under the heading 'Workplace Inspection', the Manual instructs to be aware of hazardous situations such as 'unstable or slippery surfaces' and 'wind and weather conditions' (page 13). * The Manual provides detailed instructions relating to the operation of the Genie lift including function tests (page 9-12), load positioning (page 16), maximum load capacity (page 17), and raising and lowering a load (page 15). In relation to the risk of crushing hazards and in the operating instructions, the Manual warns the operator 'do not raise unless the load is properly secured to the load handling attachment' (page 4, 15). 1. In addition to the Manual, warning labels were attached to the carriage and the mast of the Genie lift which provided warnings and instructions including 'do not raise unless load is properly secured to forks'. CONSIDERATIONS The Risk 1. The risk in each of the Summonses was the risk of workers, in particular Mr Snape and Hanna El-Khoury, suffering death or serious injury while manually lifting and installing steel structural beams as a result of being struck by the beam and/or falling from height. 2. The risk was realised when the structural steel beam fell and placed all the weight of the structural steel beam onto Mr Snape's shoulder, causing him to then fall approximately 3 meters from the ladder onto the concrete floor. Sentencing 1. I have had regard to the objectives set out in s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW) ('the Sentencing Act') for the purpose of sentencing. The purposes for which a Court may impose a sentence on an offender are as follows: 1. to ensure that the offender is adequately punished for the offence; 2. to prevent crime by deterring the offender and other persons from committing similar offences; 3. to protect the community from the offender; 4. to promote the rehabilitation of the offender; 5. to make the offender accountable for his or her actions; and 6. to recognise the harm done to the victim of the crime and the community. THE NATURE OF THE DUTY 1. The nature of the duty is one that requires a PCBU to ensure as far as reasonably practicable the health and safety of workers at the workplace. The duty included ensuring, so far as is reasonably practicable, the provision and maintenance of safe plant, safe systems of work and the provision of information, training and instruction or supervision necessary to protect persons from risks to their safety: s 19(3) of the Act. 2. The duty required the defendants to identify risks in the workplace and adopt measures to eliminate or minimise them: Kirk v Industrial Commission of New South Wales [2010] HCA 1 at [34]. 3. The notion of reasonable practicability is informed by the considerations found in s 17 of the Act. The defendants, by their pleas of guilty, have admitted that the measures to ensure safety pressed by the prosecutor would have been reasonably practicable. 4. The duty is one of strict liability: s 12A of the Act. Consequently, there is no relevant mental element to the offence whether it be reference to intent, carelessness or recklessness. 5. In Markarian v The Queen (2005) 228 CLR 357 at [31], Gleeson CJ, Gummow, Hayne and Callinan JJ set out their reasons why sentencers should have particular regard to the maximum penalties specified by statute. Their Honours stated: '…careful attention to maximum penalties will almost always be required, first because the legislature has legislated for them; secondly, because they invite comparison between the worst possible case and the case before the court at the time; and thirdly, because in that regard they do provide, taken and balanced with all of the relevant factors, a yardstick.' SENTENCING PRINCIPLES 1. The penalties imposed must give effect to the intention of the Act, in particular, protecting workers and other persons against harm to their health, safety and welfare through the elimination or minimisation of risks arising from work: s 3A of the Act. 2. The court is to be guided by the provisions of the Sentencing Act which include: 1. Section 3A which sets out the purpose of sentencing; 2. Section 21A which sets out the aggravating, mitigating and other factors in sentencing; and 3. Section 22 which provides that a guilty plea is to be taken into account on sentence, as is the time when the plea was effectively indicated or entered. 1. The court is to approach a sentencing exercise on the basis of it being one of "instinctive synthesis": Markanian v The Queen (2005) 228 CLR 537. 2. This approach to sentencing was reiterated by Russell DCJ in SafeWork NSW v HCM Building Pty Limited [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 judgment without any attempt to state precisely how any given factor has influenced the judgment.' 1. The objective degree of foreseeability is a matter for the Court to have regard to when considering the gravity of the offence: see Capral Aluminium Limited v WorkCover Authority of NSW (2000) 49 NSWLR 610 at [89]. OBJECTIVE SERIOUSNESS OF THE OFFENCE 1. The duties of the defendants require that they ensure the health and safety of workers as far as reasonably practicable. This duty is not delegable and the defendants had control and influence over the workers at the site. The duty requires the identification of risks in the workplace and an assessment of measures to address such risks. 2. Although the gravity of the risk, degree of foreseeability of the risk and the ease of implementation of remedial measures are relevant to the assessment of objective seriousness, I am not limited to taking into account such factors. 3. The primary factor to be assessed is the objective seriousness of the offence. Subjective factors play a subsidiary role: Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (1999) 90 IR 464, 474-5. 4. 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 at [714]. 5. 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 v The Queen; Smith v The Queen [2012] VSCA 82 at [62], and Veen v R (No. 2) (1988) 164 CLR 465. 6. 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 Limited & Anor (No.3) [2005] NSWIRComm 61. 7. In Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96 (Silver City), Basten JA explained the approach to sentencing as follows: '[34] 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 to guard against 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.' ….. '[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, were not even assessed, were straightforward and involved only minor inconvenience and little, if any, costs.' ….. '[53] The legitimate purpose of intervention in the present case are twofold. The first purpose is to identify the proper approach to considering the objective seriousness of the offences under the Work Safety Act. 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 materialise. The objective seriousness of the conduct will also be affected by the ease with which mitigating steps could have been taken.' (my emphasis) 1. The more obvious the risk, the ease with which it can be controlled or eliminated and the more serious the consequences of the offence, when considered together, the more serious the offence will be. 2. The relevant factors in determining the defendants' culpabilities are: 1. The Genie lift came with a manual which provided instructions for raising and lowering the lift. A warning label was attached to the carriage of the Genie lift which provided, inter alia: 'Do not raise unless load is properly secured to forks'. 1. A warning label was also attached to the mast of the Genie lift which could be read from the operator's position and provided warnings and instructions, including: 'Do not raise unless load is properly secured to load handling attachment.' 1. EK Fabrication acted in contravention of the above manual and their own SWMS, in using a Genie lift to move structural steel beams, although EK Fabrication had been instructed that a crane would have been available the following business day to move the beams. 2. At the tool box meeting on the day of the incident, Hanna El-Khoury told the workers that the job was behind schedule and that EK Fabrication was under pressure to complete the job. Hanna El-Khoury then instructed the workers, including Mr Snape, to manually install a structural steel beam and not wait for the crane. 3. Mr Snape, upon seeing the structural steel beam, informed Hanna El-Khoury that it would be too heavy to lift. Mr Snape and the other EK worker were instructed by Hanna El-Khoury to begin moving the structural steel beam into place by dragging it closer to where it was to be installed. 4. After dragging the beam for some distance, Mr Snape told Hanna El-Khoury it would be better to use a crane as the beam was too heavy to lift. Hanna El -Khoury told Mr Snape that a crane was not required and decided to use the Genie lift. It was raining. 5. Structural steel beams were moved in an unsafe manner with a Genie lift, including not securing loads on the Genie lift and using the lift in wet weather against the safety recommendations in the manual resulting in the injury to Mr Snape. 6. It was incumbent upon Rafayel El-Khoury, as an officer of EK Fabrication, to take reasonable steps to ensure EK Fabrication's systems were implemented and used. As the site supervisor of the business, Rafayel El-Khoury made decisions in relation to EK Fabrication's work, health and safety policies and procedures. 7. Rafayel El-Khoury had the capacity to take reasonable steps as set out in the Annexure to the Summons, which in turn would have allowed EK Fabrication to take reasonably practicable steps as set out in paragraph 13 of Annexure A to the EK Fabrication Summons. 8. Significant guidance material was available as detailed above at the time of the incident. 9. The risk of serious injury and death is clear in circumstances where two workers were required to lift a structural steel beam 8.134 metres in length, weighing approximately 119 kg, above their heads whilst standing on ladders 3 metres off the ground in wet conditions. The risk was obvious and blindingly so. 10. Of considerable concern to my mind is the circumstances such that Mr Snape expressed the view that the beam was too heavy to lift and that the crane should be used. Despite these complaints, Hanna El–Khoury directed the workers to proceed regardless. This was unsafe in so many ways – the beam itself was far too heavy to be lifted without mechanical assistance. Mr Snape had made this observation it was raining. Despite that, he was instructed to proceed. 11. A crane was available on one business days' notice. It seems apparent that Rafayel El-Khoury did not want to wait for the crane as the building works were behind schedule. To place the schedule of the works ahead of the workers' safety is unacceptable. The work of lifting the beam should have been stopped until the crane was available. 12. Moreover, when the Genie lift was used, it was not used correctly. The beam was placed on the Genie lift but was not secured in accordance with the manual for usage nor the warning stickers on the Genie lift. Had the beam been secured it may not have fallen onto Mr Snape's shoulder. 13. Even more deplorable is that the task that the workers were required to do was done whilst standing on ladders and then lifting a 119 kg steel beam above their heads in the rain. It is hard to imagine a more dangerous method of installation of the beam. It shows a blatant disregard for the safety of workers. The tragic irony is that Mr Snape had twice voiced his concerns over the manner in which the work was done and he ended up being significantly injured. 14. In SafeWork NSW v Emu Group Pty Limited [2019] NSWDC 537, Russell SC DCJ noted that since the start of 2016 the District Court had delivered sentence in 42 cases involving a fall from height. This court has dealt with a number of matters involving falls from defective or incomplete scaffolding and being unsafely up ladders in the construction industry, and it appears the message is not getting through to the industry. 1. Although Mr Snape expressed his concerns about lifting the beam to Hanna El-Khoury, and not to Rafayel El-Khoury, Hanna El-Khoury was the foreman on site. The duty owed by the company and Rafayel El-Khoury cannot be delegated, and had Rafayel El-Khoury conducted a risk assessment, he would have clearly seen that the circumstances of lifting a very heavy beam, up on ladders, in the rain was exposing the workers to an extreme risk of harm. It was then a simple and inexpensive step that either Rafayel El-Khoury himself, or on behalf of EK Fabrication, would direct the workers to stop working and await for the crane to arrive. 2. 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 per Latham J at [17]-[18]. 3. The maximum penalty for this offence by the corporate defendant is a fine of $1,500,000.00 and for the individual defendant is a fine of $300,000.00 which reflects the legislature's view of the seriousness of the offence. 4. By their pleas, the defendants have however conceded that there were steps which, in all the circumstances of the incident were reasonably practicable, and if taken, would have reduced the risk. 5. I accept that this offence falls within the mid-range of offending. DETERRENCE 1. In fixing a penalty in relation to this offence, an important objective feature is the need for specific and general deterrence. This is enshrined in s 3A(b) of the Sentencing Act. 2. General deterrence is a significant factor when safety obligations are breached. The fundamental duty of the court to ensure a level of penalty for a breach will compel attention to work, health and safety issues so that persons are not exposed to risks to their health and safety at the workplace: Fisher v Samaras Industries Pty Ltd (1996) 82 IR 384 at 388 3. When examining matters of deterrence, both specific and general deterrence apply: R v Miria [2009] NSWCCA 68. The Prosecutor submits that the facts of this case do not present any basis for departing from the established principles relevant to deterrence. 4. The Court of Criminal Appeal in Bulga Underground Operations v Nash [2016] NSWCCA 37; (2016) NSWLR 338 at [177]-[180] reaffirmed the principle that both aspects of deterrence are matters which should be normally given weight of some substance in the sentencing process, unless there are exceptional circumstances which would allow a Court to depart from this rule, citing with approval the decision of the Full Bench of the Industrial Court of NSW in Capral Aluminium Limited v WorkCover Authority of NSW [200] NSWIRComm 71; (2000) 49 NSWLR 610: '[74] … It follows that both aspects of deterrence [specific and general] are matters which should normally be given weight of some substance in the sentencing process; and although there may be exceptional cases (see, for example, Page v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39 at [40]-[43]), we would expect such cases to be very rare and where the relevant circumstances were held by the sentencing judge to be established, the judge must indicate with some precision the circumstances which had led to the exceptional course being adopted. … [75] … Even where an offender demonstrates good character or a commitment to rehabilitation, the court may be obliged to have regard to the need for general deterrence: see R v Thompson (1975) 11 SASR 217 at 222. This is particularly so where the offence in question is prevalent in society and represents a serious threat to the community. The need for general deterrence in relation to serious offences under the Act is undeniable.' 1. General deterrence must be a significant feature of the sentence imposed upon the defendants. The failure by a company to recognise the dangers and risks that arise to persons with large pieces of machinery is concerning. This is particularly so when persons are required to operate that machinery whilst working at height and moving very heavy beams. 2. Workers subjected to a risk of serious injury or death as a result of being struck by a large piece of plant and then falling from height is not unique to the circumstances of these defendants. The imposition of a component directed towards general deterrence, it is hoped, will highlight the need for other corporations and individuals of proper planning and development of procedures to eliminate, or at the very least severely minimise, the presentation of such a risk. 3. Similarly, general deterrence can be appropriately used to direct the industry's attention to the consequences of inattention and the need for greater concentration on the potential risks associated with the operation of machinery in an industrial context. 4. In relation to specific deterrence, the attitude of the defendants to questions of workplace safety and any steps taken to improve the safety following a breach of a duty are relevant, as is the propensity for the defendants to reoffend. 5. The requirement to comply with the expectation of the community, that both large and small employers will comply with safety requirements, means that employers must take the obligations imposed by the Act very seriously. However, whilst general deterrence is a matter that I must consider in the sentencing process, it is not a factor to dominate the exercise of sentencing discretion to the exclusion of all factors. 6. In Inspector Howard v Baulderstone Hornibrook Pty Ltd [2009] NSWIRComm 92 Walton J observed at [241]-[242]: 'There is now ample authority for the proposition that the contribution of another entity to a risk to safety may be considered in mitigation in the assessment of penalty of a defendant. The authorities range from cases such as the present, where the contributing entity has provided services or advice which have contributed to the detriment to safety (McDonald's) to, more commonly, cases where the entity or entities are engaged in a common project, enterprise or task with the defendant which carries out the role of a principal, contractor or fellow sub-contractor: Morrison v Waratah; Morrison v Powercoal (2005); WorkCover Authority of New South Wales (Inspector Mansell) v Anytime Industrial Services Pty Ltd (2001) 110 IR 34; WorkCover Authority of New South Wales (Inspector Farrell) v Morrison (No 2) (2002) 112 IR 312; WorkCover Authority of New South Wales (Inspector Mansell) v Orica Australia Pty Ltd (2002) 116 IR 158 and WorkCover Authority (NSW) v Consolidated Constructions Pty Ltd (2001) 109 IR 316.' 1. The need for safe erection of structural steel beams has been stressed to the industry noting the publication by SafeWork of the Steel Erection sheet. 2. In these circumstances, I find that the need for specific deterrence is significant given the flagrant disregard these defendants had for the safety of their workers to which I have previously referred. The defendants remain in the industry and continue to perform the building works, except the main focus of the business now is fabrication, and no installation work is performed. AGGRAVATING FACTORS 1. The injuries sustained by Mr Snape were significant. He suffered an acute wedge fracture of the T8 vertebrae (33% loss of anterior vertebral body height). He has been unable to return to work. 2. In his Victim Impact Statement dated 25 September 2020, Mr Snape states that as a result of the above injuries he now suffers chronic pain, loss of mobility, depression and anxiety. The injuries have had a profound impact on the victim, transforming him from a 38-year-old father of four children to a man being unable to pick up his baby and having his personal needs met by his children. 3. Mr Snape will require further surgery and medical treatment. He is troubled by vivid dreams of the accident as well as suffering from a loss of sexual function. Mr Snape expresses a concern that he will be unable to provide for his family, and is socially isolated, resulting in anger, depression and frustration, for which he receives counselling from a psychologist. 4. Mr Snape has been unable to return to work as a consequence of the significant injuries he sustained in the incident. MITIGATING FACTORS 1. To establish a mitigating factor, the onus is on the defendants. I note that the defendants do not have a record of previous convictions: s 21A(3)(e) of the Act. 2. Mr El–Khoury provided some evidence of good character in the form of personal references which were annexed to his affidavit and I accept that he is of good character: s 21A(3)(f) of the Act. Similarly, I note that EK Fabrication has made charitable donations, however, I note that it has outstanding workers compensation insurance premiums: see Annexure G to Affidavit of Rafayel El-Khoury. 3. It is accepted that Rafayel El-Khoury has demonstrated remorse: s 21A(3)(k) of the Act. 4. The defendants entered pleas of guilty some 14 months after the brief of evidence was served and the prosecution submits that, as this was not at the first available opportunity, they ought not be afforded the conventional 25% discount based on the utilitarian value of the plea: s 22 of the Act. I accept that this was a reasonably early plea as it came before the matter was listed for trial and thus the defendants are entitled to the 25% discount. CAPACITY TO PAY 1. The defendants have raised the issue of their ability to pay any fine due to their financial circumstances. 2. Section 6 of the Fines Act 1996 (NSW) provides as follows: '6 CONSIDERATION OF 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 tp the fixing of that amount.' 1. 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 (2002) 112 IR 284 at 309 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.'' 1. The onus is on the defendants 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] NSWIR Comm 353; (2004) 137 IR 310 at 224. The defendants' capacity to pay is relevant but not decisive: Jahandideh v R [2014] NSWCCA 178 at [16]. 2. It is for the defendants to place detailed financial information that fully discloses the company's financial circumstances to the Court so as a proper assessment of its capacity to pay. However, notwithstanding the capacity of a defendant to pay a fine, the penalty to be imposed must be reflective of the objective seriousness of the offence. 3. In support of this application, I have had regard to the financial documents of the defendants which demonstrate that with regard to Rafayel El-Khoury, his liabilities significantly outweigh the approximate value of his assets along with limited financial resources. With regard to EK Fabrication, the documents would suggest that, in addition to being the subject of a statutory demand, its financial accounts indicate a loss position for both years 2019 and 2020. 4. I accept that payment of a fine might be difficult for the defendants, but the objective seriousness of the offence is such that it must be reflected in a significant fine. I accept that the defendants are unlikely to reoffend, but the seriousness of the offence is such that a fine must be imposed to send a message to employers that they must take their obligations to protect their workers from a risk of injury very seriously. To reduce the fine would not provide the level of general deterrence that is expected, given the risk that Mr Snape and Hanna El-Khoury were exposed to, and which unfortunately came home causing Mr Snape significant injuries which have left him permanently disabled. 5. The court is entitled to take into account the fact that the defendants will be liable to pay the prosecutor's costs when considering any monetary penalty to be imposed on the defendants, particularly in circumstances where there is evidence of a limited capacity to pay a fine. The costs payable to the prosecutor are an important aspect of the punishment of the defendants. The Court can also have regard to the defendants' own costs that it will have to bear as a consequence of a breach of the Act: Environmental Protection Authority v Barnes [2006] NSWCCA 246 at [78]. 6. As I have accepted that the defendants may have some difficulty paying the fine, I am of the view that to waive the payment of the prosecution's costs forms a balance between the need for general deterrence and the defendants' somewhat limited capacity to pay. 7. The appropriate fine for EK Fabrication is $240,000.00. The defendant is entitled to a discount of 25% for the early plea. 8. The appropriate fine for Rafayel El-Khoury is $20,000.00. The defendant is entitled to a discount of 25% for the early plea. COSTS 1. On the basis that the defendants may have some difficulty in paying a fine imposed, I make no order as to costs. PENALTY 1. I make the following orders: 1. The defendants are convicted. 2. The appropriate fine for EK Fabrication Pty Limited is $240,000.00 and that will be reduced by 25% to reflect a plea of guilty. 3. Accordingly, I order EK Fabrication Pty Limited pay a fine of $180,000.00. 4. The appropriate fine for Rafayel El-Khoury is $20,000.00 and that will be reduced by 25% to reflect the early plea. 5. Accordingly, I order Rafayel El-Khoury pay a fine of $15,000.00. 6. Pursuant to s 122 (2) of the Fines Act 1996 (NSW), 50% of the fines imposed are to be paid to the prosecutor. 7. I make no order as to costs. *************************** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 06 November 2020