Industrial Relations Commission of New South Wales in Court Session CITATION : Inspector Jones v T Helsby & Sons Contracting Pty Ltd (No 2) [2004] NSWIRComm 57 PROSECUTOR Inspector Steve Jones PARTIES : DEFENDANT T Helsby & Sons Contracting Pty Ltd (Administrator appointed) FILE NUMBER: IRC 897 of 2002 CORAM: Boland J CATCHWORDS : Occupational Health and Safety - Prosecution under section 16 (1) of the Occupational Health and Safety Act 1983 - Company under administration - Use of concrete cutting machine in enclosed space - Carbon monoxide - Large number of persons affected - No appearance by defendant - Hearing ex parte - Penalty imposed LEGISLATION CITED : Occupational Health and Safety Act 1983 Inspector Jones v T Helsby & Sons Contracting Pty Ltd (Administrator appointed) [2004] NSWIRComm 5 Inspector Hannah v Wonar Pty Limited (unreported, Fisher CJ, Glynn and Cullen JJ, 30 June 1992) CASES CITED : Lawrenson Diecasting Pty Ltd v WorkCover Authority of NSW (Inspector Ch'ng) (1999) 90 IR 464 Ridge Consolidated Pty Ltd v WorkCover Authority of New South Wales (Inspector Mauger) (2002) 115 IR 78 WorkCover Authority of New South Wales (Inspector Page) v Walco Hoist Rentals Pty Ltd (No 2) (2000) 99 IR 163 Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610, 99 IR 29 HEARING DATES: 03/01/2004 DATE OF JUDGMENT: 03/19/2004 PROSECUTOR Mr R Reitano of counsel Solicitor: Ms M Simpson LEGAL REPRESENTATIVES: Phillips Fox DEFENDANT No Appearance JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: BOLAND J Friday 19 March 2004 Matter No IRC 897 of 2002 INSPECTOR STEVE JONES v T HELSBY & SONS CONTRACTING PTY LTD (No 2) (Administrator Appointed) Prosecution under section 16(1) of the Occupational Health and Safety Act 1983 JUDGMENT [2004] NSWIRComm 57 1 In Inspector Jones v T Helsby & Sons Contracting Pty Ltd (Administrator appointed) [2004] NSWIRComm 5 the defendant was found guilty of an offence under s 16(1) of the Occupational Health and Safety Act 1983. The circumstances giving rise to the offence were described at [6] of the judgment as follows: 6 The prosecution by Inspector Jones concerned a toxic fume incident that occurred on 18 February 2000 in the Sydney suburb of Ashfield. The evidence confirmed that the defendant was a plumbing contractor that had been contracted by Skyline Interiors Pty Ltd to carry out certain plumbing work at the premises of Chubb Security Holdings Australia Limited ("Chubb"). In carrying out that work the defendant contracted Supercut Concrete Service Pty Ltd ("Supercut") to undertake concrete cutting at the premises. An internal combustion engine fuelled by liquefied petroleum gas operated the concrete cutting machine. The construction work was being carried out in the proposed canteen area at the basement of a building. At the time the machine was in use employees of Chubb were working in an adjacent office area that included the accounts payable section. The adjacent office area was serviced by an air conditioning system and by a joint roof cavity with the proposed canteen area. During the construction work and afterwards persons working in the adjacent office area began to experience symptoms such as nausea, headaches and dizziness. Seventeen workers were hospitalised due to carbon monoxide poisoning. In total, forty-seven workers were affected by the carbon monoxide. 2 The defendant was not represented in the proceedings. The Court said in this respect at [5]: 5 I am satisfied that the relevant order was served on the defendant and that the defendant and the Administrator were aware of the time and place for hearing. The Administrator made a conscious decision not to be represented. The matter was heard ex parte. 3 At [33] of the judgment the Court said: 33 I find the offence under s 16(1) of the Act proven. The Industrial Registrar is directed to serve a copy of this judgment on the defendant's Administrator, Mr Murray Godfrey of Vouris & Bell Chartered Accountants. I will hear the parties as to sentence and costs at 10.00 am on Monday 1 March 2004. The parties have liberty to apply in the meantime if that date is not convenient. 4 The Registrar advised the Court that a copy of the judgment had been served as directed. There was no appearance for the defendant in the sentencing proceedings. 5 The charge constituting the offence (with the exception of particular (g), which was not made out) was that the defendant: failed to ensure that persons not in its employment were not exposed to risks to their health and safety arising from the conduct of its undertaking while they were at is (sic) place of work. In particular the Defendant failed: (a) To conduct an adequate risk assessment prior to the use of a concrete cutting machine in or about the Premises. (b) To provide adequate training and instruction to persons not in its employment in risk assessment procedures to ensure the safe use of the concrete cutting machine in or about the Premises. (c) To ensure that persons not in its employment who were at risk of exposure to carbon monoxide were adequately warned of the risks of exposure prior to the use of the concrete cutting machine in or about the Premises. (d) To provide adequate ventilation whilst the concrete cutting machine was in use at the Premises. (e) To ensure that persons not in its employment were adequately protected from inhaling or being otherwise exposed to carbon monoxide at the Premises. (f) To evacuate persons not in its employment from the Premises prior to use of the concrete cutting machine at the Premises. (g) To fix a carbon monoxide limiting device such as a catalytic converter to the concrete cutting machine at the Premises. (h) To prevent the concrete cutting machine from being used in the Premises in its condition at the time. 6 As Mr R Reitano of counsel for the prosecutor submitted, the main factor to be considered in determining penalty is the objective seriousness of the offence: Inspector Hannah v Wonar Pty Limited (unreported, Fisher CJ, Glynn and Cullen JJ, 30 June 1992); Lawrenson Diecasting Pty Ltd v WorkCover Authority of NSW (Inspector Ch'ng) (1999) 90 IR 464 at 474 - 475); Ridge Consolidated Pty Ltd v WorkCover Authority of New South Wales (Inspector Mauger) (2002) 115 IR 78 at [28]. 7 Mr Reitano submitted the offence was serious, in that whilst there was no fatality the effect of carbon monoxide gas on a large number of persons at a workplace was a matter of grave concern. 8 There can be no doubt that the offence was serious and should attract a penalty at the high end of the range. The defendant failed in nearly every relevant respect to take steps to ensure that persons were not subject to the risk of carbon monoxide poisoning by emissions from the concrete cutting machine. The consequence was that large numbers of people were affected by this toxic fume incident and 17 persons were taken to hospital. 9 Mr Pearson of TestSafe Australia, who provided a report into the incident and who the Court accepted as an expert, said in his evidence that the concentration and volume of carbon monoxide that could have been produced by the saw were sufficient to pose a lethal risk to the concrete saw operator and persons in the immediate vicinity. Mr Pearson said that: Although the concentration of CO that the office workers were exposed to is not known exactly, it appears possible that it may have been high enough so as to pose a risk of fatality to persons with severe heart disease or the foetuses of pregnant women. 10 The steps available to avoid the risk to safety from the emissions were relatively straightforward. Given the condition of the machine these steps included not using the machine at all within the premises, or evacuating the premises prior to using the machine, or ensuring that the machine was in a proper state to be able to be used within the premises and that it did not emit poisonous gas or, if it did, the emissions were within acceptable levels and that ventilation was adequate. 11 The maximum penalty in this case is $550,000. In relation to the relevance of the maximum penalty for an offence, Wright J, President observed in WorkCover Authority of New South Wales (Inspector Page) v Walco Hoist Rentals Pty Ltd (No 2) (2000) 99 IR 163 at 185-186: The maximum penalty available for an offence reflects the "public expression" by parliament of the seriousness of the offence; a large penalty indicates the gravity of the offence as perceived by the community. The task of the Court is thus to assess the relative seriousness of the offender's particular offence in relation to a worst case for which the maximum penalty is provided. Having determined the relative seriousness of the offence, the penalty to be imposed is that which approximately correlates upon the penalty scale of penalty set by the legislature from zero to the maximum: Camilleri's Stock Feeds Pty Limited v Environment Protection Authority (1993) 32 NSWLR 683 at 698 - 699; Nesmat Pty Limited v WorkCover Authority (NSW) (1998) 87 IR 312 at 321; and Albury City Council at 407 - 408. 12 Both general and specific deterrence are matters that should be taken into account in determining the appropriate penalty to be imposed. In particular, a Full Bench of the Commission in Court Session has recognised that in the industrial context, it will be rare that a sentencing court need not impose a sentence that includes an element of general deterrence: See Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610; 99 IR 29 at [71]. Consistent with the decision in Capral Aluminium it is appropriate for the penalty to include an element for general deterrence. The use of concrete cutting machines is common throughout the building and construction industry and it would appear that such machines can be utilised in enclosed areas, although how safe that practice might be would depend on the area where the machine is to be used and the measures taken to ensure persons are not affected. It is important, in my opinion, that employers who use concrete cutting machines in enclosed areas understand that the work is to be done in a manner so as to ensure the safety of persons who might otherwise be affected by fumes from the machine and that any breach of the occupational health and safety laws in this respect may attract a heavy penalty. 13 As to specific deterrence, I note that the defendant is under administration. However, there is no evidence before me as to what direction the administration of the defendant is taking, including whether or not the defendant is continuing to trade. In those circumstances, I consider I should set a level of penalty that pays some regard for the need for specific deterrence. 14 The defendant entered a not guilty plea and so no discount of the penalty is warranted in that respect. Further, given the defendant's failure to appear, no factors in mitigation were raised and no such factors are self evident. 15 It is apparent from some of the information filed by the prosecutor that the defendant claimed it had a level of debt that, according to the Administrator, prevented the defendant from defending the prosecution. It might be thought that the imposition of a penalty on the defendant would, in the circumstances, be futile. Two things may be said about that. Firstly, no proof of debt was in evidence. Secondly, one of the principal purposes of punishment is to deter future breaches by others. General deterrence is an important consideration in this matter given the very high danger of persons being affected by carbon monoxide emissions from concrete cutting machines where they are used in enclosed areas. 16 The prosecutor has sought an order for costs and disbursements of $72,688.70 and has provided an itemised account. Orders 1) The offence is proven and a verdict of guilty is entered. 2) The defendant is convicted of the offence as charged. 3) The defendant is fined an amount of $220,000 with a moiety thereof to the prosecutor. 4) Subject to any objection being taken within 14 days of the date of this judgment by the Administrator the defendant shall pay the prosecutor's costs and disbursements in an amount of $72,688.70. Any dispute over costs will be dealt with by the Court. ________________________________ 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.