Industrial Relations Commission of New South Wales in Court Session CITATION : Inspector Colin Price v Brian Henry Taylor [2002] NSWIRComm 99 PARTIES : Inspector Colin Price v Brian Henry Taylor. Prosecution under s 16(2) of the Occupational Health and Safety Act, 1983 FILE NUMBER: IRC 8012 of 2001 CORAM: Haylen J CATCHWORDS : Occupational Health and Safety Act 1983 - s 16(2) prosecution - plea of guilty - clarification of guideline judgment in R v Thomson by Court of Criminal Appeal - principles appropriate to be applied on plea of guilty - financial circumstances of defendant considered - discount allowed for early plea and objective factors - penalty imposed. Boiler and Pressure Regulation 18 Crimes (Sentencing Prodecure) Act 1999 LEGISLATION CITED : Factories Shops and Industries Act 1952 s 65A Fines Act 1996 s 6 Occupational Health and Safety Act 1983 s 16(1) s 16(2) s 51A Cameron v The Queen [2002] HCA 6 Capral Aluminium Ltd v WorkCover Authority (2000) NSWLR 610. Fletcher Constructions (Aust) Ltd v WorkCover Authority (1999) 91 IR 66 at 77-81 Haynes v CI & D Manufacturing Pty Ltd and Anor (1995) 60 IR 455 Inspector Dall v D F McCloy Pty Ltd [2002] NSWIRComm 51 Lawrenson Die Casting Pty Ltd v WorkCover Authority (1999) 90 IR 464 at 474 R v Cook [2002] NSW CCA 140 R v Howland (1999) A Crim R 273 CASES CITED : R v Jurisic (1998) 45 NSWLR 209 R v Sharma [2002] NSW CCA 142 R v Slattery (1996) 90 A Crim R 519 R v Thomson, R v Houlton (2000) 49 NSWLR 383 Tyler v Sydney Electricity (1993) 47 IR 1 at 5 Wong and Leung v The Queen [2001] HCA 64 WorkCover Authority of New South Wales (Inspector Benbow) v Converquip Pty Ltd (2001) 106 IR 258 HEARING DATES: 05/08/2002 DATE OF JUDGMENT: 05/13/2002 PROSECUTOR: Mr R Reitano of counsel SOLICITOR: James Fox Phillips Fox LEGAL REPRESENTATIVES: DEFENDANT: Mr Charles McElroy, Solicitor SOLICITORS: Messrs Marsdens JUDGMENT: - 13 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: HAYLEN J 13 May 2002 Matter No. IRC 8012 of 2001 Inspector Colin Price v Brian Henry Taylor. Prosecution under s 16(2) of the Occupational Health and Safety Act, 1983 JUDGMENT [2000] NSWIRComm 99 1 For 20 years, the defendant, Brian Henry Taylor, operated a business named Banana Coast Truck Trailer Repairs and Towing Service. On 1 February 2000, a workplace accident occurred which resulted in serious injury to a person working at these premises operated by the defendant as a direct result of actions taken and work then being performed by the defendant. Following investigations carried out by Inspectors of the WorkCover Authority, a prosecution was commenced against the defendant pursuant to s 16(2) of the Occupational Health and Safety Act 1983. 2 The matter first came into the list on 7 February 2002 and on 4 April 2002 a plea of guilty was entered by the defendant. 3 At the hearing set down to deal with the plea, the parties were able to tender a detailed Agreed Statement of Facts. As all the essential ingredients of the offence are dealt with in that document it is appropriate that its terms be set out in this judgment. The Agreed Statement of Facts stated as follows: 1. At all material times the Informant was an inspector duly appointed and empowered by section 48 of the Occupational Health and Safety Act 1983 to institute proceedings in this matter. 2. At all material times the Defendant was a self-employed person conducting business as Banana Coast Truck/Trailer Repairs and Towing Service and had a principal place of business at Pacific Highway, Wells Crossing, Grafton in the State of New South Wales. 3. At all material times the Defendant carried on general truck repairs, towing and salvage work from a workshop located at his place of business at Halfway Creek via Grafton. 4. At all material times the Defendant contracted with Michael Redwood to carry out repair work on a truck cabin at his place of business at Pacific Highway, Halfway Creek via Grafton. 5. On 1 February 2000 the Defendant was attempting to test a hydraulic cylinder for leaks of (sic) using a compressor to pump air into the hydraulic cylinder whilst working at the premises. Prior to testing the hydraulic cylinder alternations (sic) had been made to it. When testing the hydraulic cylinder it exploded soon after the air was connected. The end section of the hydraulic cylinder was propelled a distance of approximately fix to six metres. Whilst being propelled the hydraulic cylinder hit Michael Redwood. 6. As a result of the hydraulic cylinder hitting Michael Redwood he suffered a dislocated thumb, a fracture to the tibia and fibula and left ankle and cuts and lacerations to his left leg. 7. On 16 February 2000 Inspector Plowright and Senior Inspector Garry Sandall of the Workcover Authority of NSW attended the Defendant's principal place of business at Pacific Highway, Wells Crossing, Grafton in the State of New South Wales. The Inspectors observed: (a) At the premises there was a workshop. The workshop was portal frame clad with zincalum sheeting, four open bays with trucks in each in various states of repair and a large shed joining onto the right end. Above the middle bay was a yellow sign with white and black writing which bore the words "Banana Coast Towing"; (b) After entering the premises the Inspectors were shown through an open doorway and into a side bay. A large lathe was situated to their left and was about two metres from the back wall. All of the surrounding walls were lined with shelves which had on them engine parts for trucks. Directly in front was a large table which was piled high with an assortment of truck parts and a large bed mattress. Under the table were crammed motor vehicle parts and other odds and ends; (c) Over the back of the table was a space of about 2 metres long by one metre to the back and side walls. In this space there was a drill press. There was also a green painted air compressor which stood 1200mm high and 910mm long and 450mm wide. The air compressor was lined up against the wall. The Defendant told the Inspectors that this was the air compressor used to pressurise the hydraulic cylinder which gave rise to the prosecution; (d) The air compressor and the electric motor to drive it were mounted on top of a cylindrical receiver. This was supported by four angle bar legs welded to the knuckle radius of the dished ends, two at either end with flat bar feet to the side of the angle bar. The receiver was cylindrical in shape and measured 910mm by 450mm in diameter with dished ends inserted and fillet welded into each end; (e) On the dish and end closest to the drill press were a number of marking which had metal stamped into it; (f) A plastic sticker was fixed under the stamp referred to in the previous paragraph which read "Ray Chilton, Boiler Pressure Vessel, Accredited Inspection Service Registration No. 183.0.7800 Hazard Level DP 000 Litres 120 Certified Pressure 000Kpa Inspection Date 9/2/2000; (g) At the other end of the dished end was mounted a pressure gauge with graduated markings 0 to 200 psi. The gauge was filled with a liquid which was used so as to prevent shock (the liquid was presumed to be glycerine which is usually used in such a way); (h) There were not visible markings to identify the manufacturer or the markings as required by the pressure vessel regulations to Australian Standard AS12101997; (i) At the back of the workshop a hydraulic cylinder with a dished end attached was sitting in some long grass. The Defendant indicated that this was part of the hydraulic cylinder which had exploded; (j) There was a name plate attached to the shell of the hydraulic cylinder which was inscribed with a hard metal stamp; (k) The vessel was domed shaped with two dents 50 mm apart and running across the knuckle radius up to a coupling identified as "G" at one end and open at its other extremity. There was observed material which appeared consistent with weld marks which extended around the circumference of its open extremity; (l) The vessel appeared to be made from carbon steel material and was cylindrical in shape. Its dimensions were approximately 375mm in length plus 120mm for the dish end with an inside diameter of 600mm and a wall thickness of 3mm; (m) Three fittings were located at the upper dome section of the vessel which penetrated its walls through two by 10mm welding couplings - one of which was identified as "G" and the other of which was 50mm welded half coupling into its inner area; (n) The coupling marked "G" had a brass fitting screwed into it which appeared to have been broken off flush level with the outside of the coupling. The other 10mm coupling had a pipe attached to the inside bent 90 degrees to the shell wall and these two couplings were 180 degrees apart and 65mm in from the outer edge; (o) The shell had 1 by 50mm half coupling 200mm from the welded circumferential on the same centre line as the 50mm coupling in the dome end which was 120mm in from the edge of the dome; (p) At the time of inspection the flat end plate was unable to be located. 8. At the time that the Inspectors inspected the premises the compressor was unplugged and not in use. The Inspectors issued a Prohibition Notice no. 108499 against the air receiver which had not been certified by a competent person. 9. On 2 February 2000 Inspector Parfitt of the Workcover Authority issued to the Defendant Prohibition Notice no.117281 because the compressor had not been tested and no guard was fitted to the vee belts at the premises. The Prohibition Notice required the Defendant to have the compressor tested and to fit a guard to the vee belt. 10. On 2 February 2000 Inspector Parfitt of the Workcover Authority issued Improvement Notice No. 210449 to the Defendant stating that persons were not to be exposed to the risk of injury to do (sic) falls from heights while accessing and egressing the mezzanine area in the workshop. The Improvement Notice required the Defendant to provide and maintain safe and adequate means of access and egress to and from the mezzanine area in the workshop. The Defendant's attention was drawn to Australian Standard 1657 of 1992. 11. As a result of the investigation Inspector Price concluded that: (a) the Defendant had carried out alterations to the hydraulic cylinder at the premises by cutting it shorter and welding another piece of metal onto the end of the hydraulic cylinder; (b) the effect of the modifications and the method used by the Defendant to test for leaks caused the end of the hydraulic cylinder to be propelled the five or six metres across the workshop as soon as or shortly after compressed air was introduced to the hydraulic cylinder; (c) the Defendant had admitted that the cylinder that he was testing would not be required to work under pressure when it was installed on the truck; (d) there was no need for the Defendant to use compressed air to rest the cylinder to see if their (sic) were any leaks; (e) the Defendant had a safer alternative of using water or oil instead of compressed air for testing the cylinder for leaks; (f) Michel (sic) Redwood was working as sub-contractor and not an employee at the time of the accident. 12. Section 65A of the Factories, Shops and Industries Act 1962 requires that when testing for leaks using air the testing must be carried out so that the method being used was not harmful to persons in the vicinity. In addition the Boiler and Pressure Vessel Regulation made under the provisions of the Factories, Shops and Industries Act 1962 requires at Regulation 18 that every pressure vessel subject to pressure by air must have a suitable safety valve fitted to prevent the vessel being worked at a pressure greater then (sic) the maximum allowable safe working pressure of the pressure vessel. 13. On 1 February 2000 at his premises located at Pacific Highway, Halfway Creek via Grafton in the State of New South Wales the Defendant failed to ensure that persons not in his employment and in particular Michael Redwood were not exposed to a risk to their health or safety arising from the conduct of the Defendant's undertaking while persons were at his place of work in that the Defendant: (a) carried out pneumatic pressure testing of a hydraulic cylinder in a manner that was inherently unsafe; (b) carried out alternations (sic) to a hydraulic cylinder which made the hydraulic cylinder inherently unsafe for pneumatic pressure testing; (c) failed to ensure that the pneumatic pressure testing of the hydraulic cylinder was carried out in a manner which did not expose other persons to a risk to their health and safety. 14. The Defendant has no prior convictions under the Occupational Health and Safety Act 1983 or the associated legislation. 4 The prosecutor also tendered, without objection, ten coloured photographs which depicted the hydraulic tank and the end section of the hydraulic tank which, in effect, was under pressure, blown across the workplace and injured Mr Redwood. The photographs gave some indication of the general work area and the scene of the accident. There was also a coloured photograph showing the extensive injury to Mr Redwood's left leg. 5 Mr Taylor gave evidence by way of affidavit and was not cross-examined by the prosecutor. In his affidavit Mr Taylor said he had been operating a truck repair and towing business in Grafton for approximately 20 years. At the date of the accident he was trading under the business name "Banana Coast Truck Trailer Repairs and Towing Service", a business that was last registered in August 1999 with registration remaining in force until December 2002. Prior to operating this business in Grafton, Mr Taylor had worked in Sydney. He had certificates in welding and diesel mechanics and operated truck repair businesses in Sydney. In other businesses he had operated in the past he had employed persons to assist in the task but in the time that he had been operating the business at Grafton he had not employed any person. 6 He had met Mr Redwood through his father, who had been a friend of Mr Taylor for some 30 years. Mr Taylor had from to time restored old trucks which usually required him to take truck bodies into Grafton for restoration work to be performed. He became aware that Mr Redwood, who did this type of work, was looking for work and so he contracted with him to repair and paint the cabin of a R 600 Mack truck. Mr Redwood used his own tools and other materials to enable him to do the required work. 7 On 1 February 2000, Mr Redwood was working on the Mack truck and Mr Taylor was working on another truck. Mr Taylor proposed to fit a reservoir or tank to gravity feed a hydraulic system to the truck upon which he was working. The reservoir had a "breather" in the top of it and he had cut the bottom off a cylinder that he had in the workshop and had cut a segment out of it to shorten the tank. He then welded the bottom piece back on to the tank. On this day he was testing the tank for leaks by blocking the breather and pumping air into the tank through an air compressor. He did not evacuate the workshop before conducting the test on the tank because he said he had intended to put 20 lbs of air into it and did not expect the bottom of the tank to blow off. 8 Mr Taylor accepted that the testing procedure he used on 1 February 2000 was not safe in the circumstances. He recognised that the WorkCover Authority had determined that the compressor did not comply with the relevant Australian and New Zealand standard at the time of the accident. He said that he had always been generally aware of the need to make sure that the workplace was safe for any person who might be working there or visiting. He accepted that he was not as familiar with his obligations as he should have been and stated that part of the reason for that lack of familiarity was because he had not employed people at this workplace. He understood that he had obligations in relation to the safety of self-employed persons. 9 Mr Taylor expressed his sorrow that the accident had happened and had caused such a serious injury to Mr Redwood. Mr Taylor had received medical reports as a result of Mr Redwood's case for compensation and he was aware that the injury was serious to the point where Mr Redwood was not expected to be able to resume duties in his trade as a panel beater as his mobility was permanently affected. Mr Taylor stated that the accident had "a greater effect upon me because I have been friendly with Michael's family for a number of years". 10 Mr Taylor said that he had closed down the business and was no longer engaged in the repair and restoration of trucks. He said that one of the reasons he ceased the business was because his health had been deteriorating over the past few years, a fact which was supported by a medical report from his treating general practitioner, Dr Nigel Bacon. 11 For the prosecutor, it was submitted that the main factor to be considered in the determination of an appropriate sentence was the objective seriousness of the offence (Lawrenson Die Casting Pty Ltd v WorkCover Authority (1999) 90 IR 464 at 474; Fletcher Constructions (Aust) Ltd v WorkCover Authority (1999) 91 IR 66 at 77-81). 12 The maximum penalty that may be imposed on the defendant for breach of s 16(2) of the Act, having regard to the fact that the offender is a natural person, was accepted to be $55,000. The defendant had no prior convictions and so s 51A of the Act was not called into operation. It was said that it was nonetheless important to note that the maximum penalty under s 16(1) of the Act which may be imposed upon a corporation is $555,000 where there is no prior conviction and $825,000 for a corporation where there is a prior conviction. The size of the available penalties provided for by the Act, it was submitted, clearly reflected the community expectation, as reflected by the legislature, that conduct under the Act was to be denounced and was to be regarded seriously (R v Slattery (1996) 90 A Crim R 519; R v Howland (1999) A Crim R 273). The safety of employees and others is a matter which the community expects to be taken seriously. 13 The prosecutor submitted that the main factor determining the objective seriousness of the offence was the nature and quality of the offence itself. Many factors may be relevant to whether or not an offence is to be regarded as one that is objectively serious. Usually the factors considered by the Court in determining such matters is whether or not the risk is an obvious or foreseeable one; whether there were simple remedial steps available to obviate the risks; the potential for injury that was created by the risk in question; as well as other factors that might cast light upon the manner in which the offence was committed. The gravity of an injury suffered did not dictate the magnitude of any penalty that should be imposed but would often demonstrate the seriousness of the detriment to safety, or the nature of the risk that was left open, occasioned by the commission of the offence (Tyler v Sydney Electricity (1993) 47 IR 1 at 5). 14 The penalty to be imposed must be one such as to compel attention to occupational health and safety and to ensure that both employees and other persons who are at work will not be exposed to any risk to their health and safety whilst at a place of work (Capral Aluminium Ltd v WorkCover Authority (2000) NSWLR 610). 15 In the present case, the prosecutor submitted there were a number of matters that pointed to the objective seriousness of the offence. At the forefront of those matters was the fairly obvious risk to health and safety that was created by introducing air pressure into the hydraulic cylinder in circumstances where there were simple, known and readily available other means of doing exactly that task in a manner that would not create any risk to health and safety. Moreover, the fact that there was a specific, particular, and legislative and regulatory requirement in respect of the work that was being undertaken highlighted the known and obvious risk the defendant created for those visiting his place of work. In this regard, reference was made to s 65A of the Factories, Shops and Industries Act 1962 and Regulation 18 of the Boiler and Pressure Vessel Regulation. It was submitted that the defendant's culpability in permitting the task to be undertaken in the way it occurred was in breach of those legislative requirements. Those requirements and the readily available and simple means of doing the same testing by using water and oil demonstrated the seriousness of the offence. 16 Further, it was submitted, the seriousness of the offence was emphasised by two particulars: not only was the defendant engaging in pressure testing of a hydraulic cylinder in a manner that was in itself inherently unsafe, but was doing so after having carried out alterations to the hydraulic cylinder which themselves rendered it inherently unsafe for pneumatic pressure testing. It was the combination of these factors that made the offence more serious in the circumstances. 17 The issue of deterrence was said to be of importance. The imposition of a penalty operates as a general deterrent and a specific deterrent. The circumstances of the offence as well as the matters observed by the Inspector set the background against which the deterrent value of any penalty should be considered. 18 The prosecutor accepted that the defendant had no prior convictions and had co-operated with the WorkCover Authority in its investigation of the matter. Importantly, the prosecutor also accepted that the defendant had entered a plea at an early stage. 19 For the defendant, it was submitted that Mr Taylor was now 60 years of age and had ceased work. The business had continued after the accident for approximately 20 months but was in a state of winding down. There were basically two reasons for the closure of the business, namely, the state of Mr Taylor's health and the occurrence of the accident which injured Mr Redwood. The machinery that had been the subject of prohibition orders imposed by the WorkCover Inspector was never used again. 20 It was said that Mr Taylor had sold most of the equipment in the business and was using the proceeds of the business for living expenses. He lived in a caravan on land owned by a person, not related, who was prepared to allow him such use. Mr Taylor had, especially in light of his medical condition, applied for a pension. 21 In relation to the question of deterrence, it was suggested that the closure of the business meant that there was little room for the effective operation of specific deterrence. In the 20 months that the business was being wound down, the prohibition orders were observed and had the effect of confining the operation of the business. In the circumstances of the type of work involved, these were all the necessary modifications to work practices that were required to ensure the safety of others who came to that worksite. DELIBERATION 22 I accept the thrust of the submissions made on behalf of the prosecutor in relation to the proper approach to be taken in setting a penalty in this case. Both the prosecutor and the defendant accepted the seriousness of this offence highlighted by the simple steps available to totally avoid the risk and the ultimate serious injury done to Mr Redwood. It may well have been that Mr Taylor, being used to working alone for such a long period, had not been as attentive as he might otherwise have been to issues of workplace safety but in every work place there are others besides employees who may be put a risk by the manner of operating the undertaking. 23 I also accept the prosecutor's submission that general deterrence has a significant role to play in the present case although, in the light of the evidence as to the state of the business, I am of the view that there is no practical role for the operation of specific deterrence. The prosecutor's submission as to the objective seriousness of the offence, the object of general deterrence and the simple means available to avoid the risk were not contested by the defendant. 24 The importance of general deterrence is highlighted in this case by the failure to observe the provisions of s 65A of the Factories, Shops and Industries Act, 1962 and Regulation 18 of the Boiler and Pressure Vessel Regulation. 25 In relation to subjective features, the defendant is entitled to have taken into account, as mitigating the objective seriousness of the offence his plea of guilty. It has been accepted by the prosecutor, and I am satisfied by reference to the details in the Court file, that this was indeed an early plea. 26 Recently there has been some controversy as to the status of the guideline judgment in R v Thomson; R v Houlton (2000) 49 NSWLR 383, especially in the light of two High Court judgments, Wong and Leung v The Queen [2001] HCA 64 and Cameron v The Queen [2002] HCA 6. It is said that these two judgments firstly call into question the validity of guideline judgments and secondly, modify the considerations applicable on a plea of guilty. Two recent judgments of five member benches of the Court of Criminal Appeal have now clarified these matters. In R v Sharma [2002] NSW CCA 142, it was held that the approach of the High Court in Cameron had no operation in New South Wales because of specific legislative provisions in the Crimes (Sentencing Procedure) Act 1999 which modified the common law. Further, the court held that criticism of a two stage approach to sentencing in Wong did not require the court to overrule R v Thomson : Thomson was declared to be good law in New South Wales and should still be followed. On the same day the court delivered judgment in R v Cook [2002] NSW CCA 140, and implicitly reasserted the appropriateness of R v Thomson and found it unnecessary to reconsider the principles set out in R v Jurisic (1998) 45 NSWLR 209 because of the judgment in Wong . It therefore seems appropriate that I apply in this case the approach set out in Thomson. In applying this approach, I believe it is appropriate to give a discount of 20 per cent for the utilitarian value of the early plea. 27 The next issue concerns the financial position of the defendant and how it is to be dealt with in the sentencing process. Section 6 of the Fines Act 1996 requires that, in the exercise of a discretion to fix the amount of any fine, the court is required to consider, amongst other things, "such information regarding the means of the accused as is reasonably and practically available to the court for consideration". The approach to this provision was considered in some detail by the President, Wright J in WorkCover Authority of New South Wales (Inspector Benbow) v Converquip Pty Ltd (2001) 106 IR 258, as well as by the Full Court of the Industrial Court in Haynes v CI & D Manufacturing Pty Ltd and Anor (1995) 60 IR 455. I recently considered and adopted the approach found in those cases in Inspector Dall v D F McCloy Pty Ltd [2002] NSWIRComm 51. While it is accepted that in terms of general sentencing policy the means of a defendant are relevant, nevertheless, the imposition of a penalty which is out of step with the objective circumstances of the offence is considered to be inconsistent with the role of the Court and may represent a failure to impose a sentence with appropriate regard to the importance of deterrence in the sentencing process. I propose to adopt that approach in the present case. 28 Although Mr Taylor swore an affidavit on the day of the hearing, which was read in the proceedings, there was no mention in that affidavit of his financial circumstances. The affidavit, in relation to personal circumstances, concentrated on the present state of Mr Taylor's health. It was in oral submissions on his behalf that some detail was given of his financial position, how the accident had affected him and influenced him in winding down the business. While it is undoubtedly preferable to have this material before the Court in a more formal way, the provisions s 6 of the Fines Act seem to contemplate some flexibility in the way in which the Court can be informed of these matters. I am satisfied on that material that Mr Taylor lives modestly and because of the state of his health will probably not work full time again and is an applicant for a pension. Those matters will be taken into account in setting an appropriate penalty. 29 There also appears to be evidence of genuine contrition in relation to this accident and the injuries occasioned to Mr Redwood, undoubtedly because of Mr Taylor's long association with Mr Redwood's father. It appears that Mr Taylor did not use the machinery again and then progressively wound down the company; the accident and the investigation following it seems to have taken its toll of him personally although I do not doubt the genuiness of his contrition. In relation to the other subjective features of the case, I would propose a further discount of ten per cent. ORDERS 30 I make the following orders: 1. I convict the defendant of the offence with which he was charged and to which he pleaded guilty. 2. The defendant is fined an amount of $10,500 with moiety thereof to the prosecutor. 3. The defendant is to pay the prosecutor's costs of these proceedings as agreed or failing agreement, as ordered by the Court. Any application made pursuant to para 3 of these orders is to be filed within 21 days of today's date. 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.