Industrial Relations Commission of New South Wales in Court Session CITATION: Inspector Prasad De Silva v Spicer Axle Australia Pty Ltd [2005] NSWIRComm 278 Appellant: Inspector Prasad De Silva PARTIES: Respondent: Spicer Axle Australia Pty Ltd (ACN: 004 256 982) FILE NUMBER(S): IRC 6964 of 2004 CORAM: Walton J Vice-President; Boland J; Backman J CATCHWORDS: Application for leave to appeal and appeal - occupational health and safety - concession by respondent that penalty manifestly inadequate - miscarriage of sentencing discretion at first instance - insufficient weight given to foreseeability of the risk - failure to consider principle of general and specific deterrence - error in assessing penalties by reference to the jurisdictional limit rather than by reference to the maximum penalty - subjective features - leave to appeal granted - appeal upheld - fresh penalty imposed - no order as to costs. LEGISLATION CITED: Occupational Health and Safety Act 2000 Beacham v Interface Manufacturing Pty Ltd and Another [2005] NSWIRComm 123 Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 Drake Personnel Ltd t/as Drake Industrial v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 432 Glass v Flexible Packaging (Australia) Pty Limited [2005] NSWIRComm 93 Inspector Maddaford v Graham Gerard Coleman & Anor [2004] NSWIRComm 317 CASES CITED: Inspector Waterhouse v Stephensons Cranes Pty Limited [2005] NSWIRComm 103 Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 Maddaford v CSR Limited and Mulgoa Quarries Pty Ltd [2004] NSWIRComm 337 O'Sullivan v The Crown in Right of the State of New South Wales (Department of Education and Training) (2003) 125 IR 361 R v Thompson, R v Houlton (2000) 49 NSWLR 383 WorkCover Authority of New South Wales (Inspector Buggy) v Weathertex Pty Ltd (2003) 127 IR 60 HEARING DATES: 08/03/2005 EXTEMPORE JUDGMENT DATE: 08/03/2005 Appellant: Ms P. McDonald, of counsel Solicitors: Phillips Fox Lawyers LEGAL REPRESENTATIVES: Respondent: Ms L. Constantine, solicitor Solicitors: Blake Dawson Waldron JUDGMENT: - 7 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION FULL BENCH CORAM: Walton J, Acting President Boland J Backman J Wednesday, 3 August 2005 Matter No IRC 6964 of 2004 Inspector Prasad De Silva v Spicer Axle Australia Pty Ltd Application by Inspector De Silva for leave to appeal and appeal against a decision of Industrial Magistrate Quinn of 8 November 2004 in Matter No 20177102/04/2 EX TEMPORE JUDGMENT OF THE COURT [2005] NSWIRComm 278 1 This is an appeal under s197 of the Industrial Relations Act 1996 ("the Act") against a sentence of $5,000.00 imposed by Industrial Magistrate Quinn on Monday 8 November 2004, on the respondent. 2 Leave to appeal is required: Drake Personnel Ltd t/as Drake Industrial v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 432. 3 On 19 July 2005 the appellant filed submissions indicating that the respondent was intending to concede the appeal. Agreed orders were set out in the appellant's written submissions. These orders have been confirmed by the respondent in its written submissions filed 1 August 2005, and orally today. The agreed orders are in the following terms: (a) leave to appeal be granted; (b) the appeal be upheld; (c) The order of her Honour M Quinn, LCM imposing a fine of $5,000 on the respondent for an offence under section 8(2) of the Occupational Health and Safety Act 2000 in CIM proceedings no 20177102/04/2 of 2004 to be set aside; (d) The New South Wales Industrial Commission in Court Session to impose a sentence in accordance with the law; and (e) The appellant and the respondent to pay their own costs of and incidental to the appeal proceedings. Decision at first instance 4 In the proceedings below, Magistrate Quinn said that it was a serious offence, "when somebody is injured". Her Honour also commented that foreseeability of the risk (to safety) is, "something that I look at". There then follows a short discourse in which her Honour appears to express doubt as to whether the risk to safety in the circumstances before her Honour was reasonably foreseeable. Her Honour next acknowledges the duty of an employer under the legislation to ensure that employees are not put at risk, and, in that context expressly notes that in relation to the offence before her no positive steps had been taken prior to the offence in relation to the conducting of a risk assessment. Her Honour then surmises that no such steps were taken because there had been no previous incidents. 5 Her Honour also addressed a number of subjective factors in her reasons. She observed first that the defendant had no prior convictions, commenting that this, "...was very fortunate given they are in such an area where you can have a lot of risk, its a dangerous manufacturing environment... certainly they were old machines...". Her Honour then noted that the plea of guilty was entered at an early stage, and that the defendant was "...quite a large corporation". Various steps and initiatives which the defendant put in place following the incident in an attempt to obviate the risk to safety, were then addressed by her Honour who commented that the focus of these post-incident measures was on assessing the risks and training and supervision. Her Honour found it of significance that the defendant, following the incident, had instituted random checks and a system of reporting perceived risks to safety at the workplace. 6 In concluding her Honour said, "the maximum I could give is a $55,000 fine, this certainly does not warrant anything like that at all, and the company is to be commended for what it has done...". A fine of $5,000 was then imposed. Consideration 7 Having considered the decision of the learned magistrate, and, having regard to the evidence and submissions which were before her Honour, as well as the agreed orders proposed by the parties in this appeal, we have concluded that her Honour's sentencing discretion miscarried and that leave to appeal should be granted and the appeal should be upheld. In doing so we have decided that it is appropriate to deal with the appeal consistently with the agreement of the parties. 8 The offence arose in circumstances where Mr Clark, an electrician, was working live at the defendant's premises replacing and installing metal protective covers on 415V three phase bus bars with a rated current carrying capacity of 300 amperes. Mr Clark was performing the work from an elevated work platform (a scissor lift) at a height approximately 4.5 metres above floor level, although he was wearing a safety harness which was anchored to the platform. According to the Statement of Facts which was tendered in the Court below although Mr Clark was working live while installing the protective covers, the electricity supplied to the bus bar could have been isolated prior to Mr Clark commencing his work by simply switching off the power supply. No risk assessment had been undertaken by the defendant in relation to work performed by Mr Clark, and Mr Clark was not provided with any induction training by the defendant. The bus bar on which Mr Clark was working was installed in 1965. 9 At the time of the incident, Mr Clark was in the process of inserting a cover into the bus bar when he noticed that something was beginning to arc. This was followed by an electrical flash. Mr Clark dived over the side of the scissor lift and was suspended by his safety harness until he was released by his workmates. He sustained electrical flash burns to his arms. Photographs taken by a WorkCover Inspector Jim Allison shortly after the incident on 18 March 2003 reveal that the elevated work platform was substantially scorched and metal controls and other items had melted. 10 This brief description of events preceding the incident clearly discloses a serious and obvious risk to the safety of Mr Clark and any other persons who were working in the vicinity. Mr Clark was exposed at all times during the installation and replacement process of the protective covers on the bus bar to a high risk of injury by virtue of working on a bus bar which had not been de-energised or isolated from the electrical supply. Moreover, the particular task was being performed 4.5 metres above the floor of the premises. Despite these facts which were before her Honour, her Honour nevertheless expressed doubt as to whether the risk to safety was reasonably foreseeable. It is a little difficult to discern from her Honour's reasons the precise basis for this but her Honour appears to have been influenced by the defendant's size and the fact that it had no prior convictions. Her Honour may also have been focusing on the incident itself in assessing the foreseeability of the risk. In this regard, her Honour expressed a view that a risk assessment may not have identified the risk posed by the work of installing and replacing the protective covers because a number of covers had been safely installed prior to the incident. Whatever factors her Honour considered, we are of the view that she failed to give sufficient weight to the obvious and foreseeable nature of the risk. Insofar as her Honour may have focussed on the incident or accident instead of the general risk to safety, her Honour was also in error: O'Sullivan v The Crown in Right of the State of New South Wales (Department of Education and Training) (2003) 125 IR 361. 11 In addition, her Honour's observation that an offence was serious "particularly when someone is injured" misstates the law. It has been emphasised many times in this jurisdiction that damage or injury does not, of itself, dictate the seriousness of the offence or the penalty: see Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 at [94] and [95] and Maddaford v CSR Limited and Mulgoa Quarries Pty Ltd [2004] NSWIRComm 337 at [17] and [18]. 12 Her Honour also failed to take account at all of the principles of general and specific deterrence. Both are relevant to the circumstances here. General deterrence is particularly relevant in relation to the dangers of working with live electricity, which have been well documented in this jurisdiction, and, which are often so readily and easily preventable. The incident the subject of the offence could have been prevented by simply switching off the power supply which according to the respondent could be isolated in sections. Specific deterrence is also clearly relevant to the present circumstances. Her Honour expressly noted that the defendant, a corporation, was quite large. There was nothing in the material before her Honour to indicate that the defendant was not still operating in its chosen field. Her Honour was in error in failing to consider these principles, both of which enlarge the objective seriousness of the offence and should influence the assessment of penalty: Inspector Maddaford v Graham Gerard Coleman & Anor [2004] NSWIRComm 317 at [80]. 13 The appellant in written submissions contends that the learned Magistrate gave "substantial weight" to a number of subjective factors, in particular changes that were introduced after the date of the offence. We agree. Although her Honour's reasons are not lengthy, the majority of those reasons emphasise factors personal to the defendant. Very little attention is directed in the reasons to the objective factors. In relation to general and specific deterrence for example no attention was directed to either of these principles. In this respect the decision reveals further error. It is a well known and long established principle of sentencing that subjective considerations play a subsidiary role in the sentencing process to the objective considerations: see for example Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 at 475. 14 The respondent, a corporation, was charged with a breach of s8(2) of the 2000 Act. The maximum penalty for a corporation with no prior convictions is $550,000 even though the jurisdictional limit in the local court is $55,000: R v Doan (2000) 50 NSWLR 115. Her Honour made no reference to this fact and it would appear from her statement in the decision that "the maximum I could give is a $55,000 fine", that her Honour assessed the penalty by reference to the jurisdictional limit, rather than by reference to the maximum penalty. This is another error, the frequency of which is becoming apparent to this jurisdiction as evidenced by a series of recent judgments: Inspector Waterhouse v Stephensons Cranes Pty Limited [2005] NSWIRComm 103; Glass v Flexible Packaging (Australia) Pty Limited [2005] NSWIRComm 93; Beacham v Interface Manufacturing Pty Ltd and Another [2005] NSWIRComm 123. 15 Given the errors we have identified in her Honour's decision we have determined to set the penalty imposed by her Honour aside and assess the appropriate sentence. In doing so we take into account the appropriate scale of penalties, the objective seriousness of the offence, and, mitigating factors. In accordance with the conventional approach to prosecution appeals we adopt a conservative approach and impose penalties at the lower end of the range of available sentences having regard to the principle of double jeopardy: as to which see WorkCover Authority of New South Wales (Inspector Buggy) v Weathertex Pty Ltd (2003) 127 IR 60 at [54] - [55], and, Maddaford v Coleman [33] - [36]. 16 We acknowledge that the plea of guilty was entered early. In accordance with the prevailing guidelines we assess the appropriate discount at 25 percent: R v Thompson; R v Houlton (2000) 49 NSWLR 383. We consider that a further discount is appropriate after taking into account other subjective considerations. Orders 17 Taking into account all of the matters to which we have referred, the submissions of the parties, and also the respondent's concession that the appeal is upheld we determine a penalty of $10,000. We take into consideration that the respondent has already paid into the Local Court the $5,000 fine imposed at first instance. 18 We make the following orders: (1) Leave to appeal is granted; (2) The appeal is upheld; (3) The penalty at first instance is set aside; (4) The respondent, Spicer Axle Pty Limited is fined the sum of $10,000 with a moiety of the penalty to be paid to the appellant; (5) No order as to costs. As the fine imposed at first instance has been paid, the Registrar will need to have regard to that fact when the further amount is paid in accordance with this judgment. _______________________ 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. 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