Industrial Relations Commission of New South Wales in Court Session CITATION : Morrison v Normandy Industrial Minerals Ltd [2003] NSWIRComm 165 PROSECUTOR Rodney Dale Morrison PARTIES : DEFENDANT Normandy Industrial Minerals Limited FILE NUMBER: IRC8486 of 2001 CORAM: Peterson J CATCHWORDS : Occupational health and safety - Mine Manager welding fuel tank - Fatal burn injuries suffered - Welding equipment brought to site without knowledge of employer - Plea of guilty - Question of culpability - Fine imposed. LEGISLATION CITED : Occupational Health and Safety Act 1983 s15(1) Mines Inspection Act 1901 CASES CITED : WorkCover Authority of New South Wales (Inspector Twynam-Perkins) v Maine Lighting (1995) 100 IR 248 HEARING DATES: 12/17/2002 DATE OF JUDGMENT: 05/23/2003 PROSECUTOR Mr M K Scott of counsel SOLICITOR Legal Services Unit Department of Mineral Resources ST LEONARDS. LEGAL REPRESENTATIVES: DEFENDANT Mr B D Hodgkinson SC SOLICITOR Clayton Utz SYDNEY. JUDGMENT: - 12 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: PETERSON J DATE: 23 MAY 2003 Matter No. IRC8486 of 2001 RODNEY DALE MORRISON v NORMANDY INDUSTRIAL MINERALS LIMITED Prosecution under s15(1) of the Occupational Health and Safety Act 1983 JUDGMENT 1 Normandy Industrial Minerals Limited ('Normandy') is charged by Rodney Dale Morrison as prosecutor on behalf of the Department of Mineral Resources, with an offence against s15(1) of the Occupational Health and Safety Act 1983 ('the Act'). The offence relates to events surrounding the suffering of fatal burn injuries by Mr Peter Davenport who was employed by Normandy as the Mine Manager of the Commercial Mineral Cressfield Bentonite Mine at Cressfield via Scone, New South Wales. The defendant has pleaded guilty to the charge, the terms of which are set out later in par.24 of the statement of facts. 2 Cressfield Mine is a small mine employing a maximum of five people, not all of whom are permanent employees. Mr Davenport had been employed in the mining industry for over 29 years and had acted as the Mine Manager of the mine until amendments to the Mines Inspection Act 1901 in July 1999 required the appointment of both a production manager and a mine manager. Mr Davenport was then appointed Production Manager, having the senior production responsibilities for the mine. 3 Mr Davenport suffered burns to 95 percent of his body when a new diesel fuel tank he was fabricating for use in a John Deer Grader exploded. At the time of the explosion, the fuel tank contained diesel fuel which had created vapours which ignited while Mr Davenport was welding or brazing a fitting to the fuel tank. He was removed to hospital and died the following day, 15 February 2000. 4 At that date the shares in Normandy were held by Normandy Mining Limited. On 1 July 2000 those shares were acquired by Unimin Corporation, the US parent of Unimin Australia Limited which since that date has operated the Cressfield Mine. The hearing of the matter was based largely upon a statement of facts agreed between the parties which is in the following terms: 1. The defendant, at all material times operated a bentonite mine known as Commercial Mineral Cressfield Bentonite Mine at Cressfield via Scone New South Wales ("the mine") 2. At all material times, Peter Davenport was employed by the defendant as production manager. Mr Davenport had been employed in the mining industry for over 29 years and had previously acted as the mine manager of the mine until legislative changes in July 1999 required the appointment of both a production manager and mine manager for all mines. 3. At all material times Mr Greg Edmonds was employed by the Defendant as a plant operator. 4. On 14 February 2000 Mr Davenport, in his role as production manager, arranged for and/or assisted in the removal of a fuel tank from a John Deere Motor Grader that had been removed from service at the mine for the purpose of repair. 5. During that day, Mr Davenport decided that the fuel tank so removed could not be repaired and that a new one should be created. 6. Mr Davenport made a decision to fabricate a new fuel tank on site. The fabrication of fuel tanks was not standard practice within the defendant's operations and the welding equipment used for the task was provided by Mr Edmonds. However, it was not an unusual event for welding to occur on the mine site. Mr Moran, the Mine Manager had noted that prior to 14 February 2000 that occasionally weekly reports from the mine would show that something had been welded on site. 7. Having made the decision to fabricate a new fuel tank, Mr Davenport travelled to Scone to the premises of Brooks Brothers (Scone) Pty Limited to obtain material for the fuel tank and have that material cut and pressed into the appropriate shape. 8. Returning with the material so cut and pressed to the mine, Mr Davenport commenced assembly of the fuel tank on the afternoon of 14 February 2000. In doing so, the ends of the fuel tank were tack welded in place so as to prepare the tank for welding of the seams on the following day. 9. Prior to the tack welding taking place on 14 February 2000 no hot work permit had been issued. 10. On 15 February 2000 Mr G Edmonds, acting under the supervision of Mr Davenport completed the brazing of the fuel tank. 11. Niether Mr Davenport nor Mr Edmonds held any welding qualification nor had a hot work permit been issued. 12. Mr Davenport assisted Mr Edmonds by holding the sheet steel in place and cutting holes in the top and bottom of the tank using a drill and jigsaw. Mr Edmonds then proceeded to braze weld into place the water trap on the base of the tank and the filler inlet on the top of the tank. 13. Prior to the lunch break, Mr Davenport and Mr Edmonds placed 45 litres of diesel fuel into the tank. It was intended that minor spot repairs would be carried out on the tank after the lunch break. 14. Following the introduction of diesel fuel into the tank, the diesel was used as an identifying medium to check the tank for leaks. 15. After lunch, weld repairs were performed using MIG welding equipment with the diesel fuel still in the tank. Mr Edmonds and Mr Davenport carried out this work with the tank (black in colour) containing 45 litres of diesel fuel, being left in the direct sunlight. Neither Mr Davenport nor Mr Edmonds held any appropriate qualification which would allow them to properly carry out venting procedures to release the diesel fuel vapours within the tank. 16. Mr Edmonds worked on brazing of the "filler hole" by removing the cap from the hold, brazing around the base of the stem of the "filler hole" and then replacing the cap. Once the cap was replaced, the tank was pressurised to establish whether any further brazing was required. This procedure did not actively expel diesel fuel vapours. 17. After the work on the "filler hole" had been completed the tank was turned upside down and Mr Davenport took over the task of brazing cracks on the water trap situated at the base of the tank. Mr Davenport had no qualifications or training in the proper process to be followed in venting the tank of diesel fuel vapours. 18. Mr Davenport experienced a number of problems with the brazing bond around the water trap. This required continual re-brazing over a period of half an hour. During this brazing work the diesel fuel remained within the tank. 19. At about 3.30pm on 15 February 2000 Mr Davenport was attempting to braze up the recurring cracks in the water trap. Mr Edmonds had moved into the storage shed so as to pack up equipment. 20. Mr Davenport had pressurised the fuel tank to identify areas of further cracking, he then attempted to braze a large cracked area. 21. Whilst packing away equipment Mr Edmonds heard a noise which was subsequently attributed to the fuel tank hitting the shed. This noise was followed by the sound of Mr Davenport yelling. Mr Edmonds emerged from the tool storage shed and observed Mr Davenport to be on fire. Mr Edmonds attempted to extinguish the fire by first using a dry chemical type fire extinguisher which proved ineffective. Mr Edmonds then employed a second fire extinguisher of the carbon dioxide type which was effective in putting out the flames. 22. An ambulate arrived approximately 20 minutes after the accident and Mr Davenport was taken to Scone Hospital and then to John Hunter Hospital at Newcastle. Mr Davenport died at Concord on 16 February 2000 as a consequence of the severity and generalised nature of his burn injuries. 23. Following the death of Mr Davenport, the defendant took the following steps: (a) provided counselling to all relevant staff at the mine; (b) provided information and training on the safe use of hazardous materials to staff at the mine, including establishing a hazardous substances register at the mine; (c) implemented a hot work permit procedure at the mine and undertook a review of its working procedures for welding work; (d) ensured that foam fire extinguishers are available at all of the defendant's sites in areas where diesel is stored or used; and (e) developed and implemented a new environmental, health and safety ("EH&S") management system across all of its operations, including at the mine. Under this new EH&S system, each site, including the mine: (i) has been provided with guidelines on risk assessment specific to the activities undertaken at the site; (ii) has a designated EH&S coordinator who is responsible for ensuring that site specific issues are identified and assessed; (iii) has been provided with information on EH&S compliance requirements including Australian Standards specific to activities (such as welding) undertaken at that site. 24. It is alleged that on 15 February 2000 at the Commercial Mineral Cressfield Bentonite Mine at Cressfield via Scone New South Wales the defendant did fail to ensure the health, safety and welfare at work of all its employees and in particular Peter Davenport and Greg Edmonds contrary to s15(1) of the Occupational Health & Safety Act, 1983 in that the defendant failed to provide or maintain systems of work that were safe without risk to health. In particular the defendant: (1) Failed to ensure that employees engaged in welding work were appropriately skilled so as to safely carry out that work. (2) Failed to provide an adequate system of supervision of employees so as to ensure that employees were observing appropriate working procedures. (3) Failed to make adequate arrangements relating to the use and handling of a hazardous substance, that is, diesel fuel, through not maintaining on site an up to date register of hazardous materials or a material safety data sheet relating to diesel fuel. 25. The defendant Normandy Industrial Minerals Limited (now known as Unimin Limited) has no prior convictions. 5 Normandy tendered the affidavit of Campbell John Jones, the Executive General Manager of Unimin Australia Limited, a position he has occupied since the acquisition of Normandy. Mr Jones deposed to a principal role of his since July 2000 being to oversee the development and implementation of a consistent standard of operation to achieve a systematic approach to risk management through Unimin's Australian operation. Unimin now employs approximately 650 people over 40 sites throughout Australia, the site numbers ranging from 1 to 35 people. Much of Mr Jones' evidence concerned the development and application of policy with respect to OH&S matters. 6 Mr Jones' affidavit dealt with an investigation undertaken by Normandy immediately following the incident: 17. . . . The investigation identified the following areas for improvement in the safety systems at the Mine: (a) Mr Davenport and Mr Edmonds' decision to undertake the fabrication of the fuel tank was inappropriate and the documented procedures available at the Mine relevant to welding did not provide detailed guidance on how to fabricate fuel tanks. The Company did not provide the equipment necessary to undertake the fabrication of the fuel tank. Mr Edmonds supplied the MIG welder that was used to undertake 70% of the fabrication of the tank. Detailed guidelines have now been developed by Unimin to clearly prescribe which tasks can be undertaken at each Unimin site, based on the skills and needs of the site. These guidelines also address which welding tasks can be undertaken at Unimin sites and the necessary equipment for those tasks. The operation of these guidelines would prevent the undertaking of structural welding such as fuel tanks, at the Mine. (b) No material data sheet ("MSD") for diesel was found at the Mine. The absence of the MSDS was in breach of the Normandy procedures set out in section 5.12.4 (page 39) of the Normandy Manual. This breach had been identified by the Site and the Site Safety Plan (dated 9 September 1999) contained a commitment to establish a register of hazardous substances by April 2000. (c) No Job Safety Analysis ("JSA") was undertaken by Mr Davenport before commencing the tasks. This was also contrary to Normandy's documented procedures set out on page 10 of the Normandy Manual and training provided to all staff at the Mine. 7 As to measures taken since the incident the affidavit set out the steps identified in paragraph 23 of the Agreed Statement of Facts. It also noted that Normandy paid for all expenses associated with the medical attention received by Mr Davenport and the direct costs of the funeral. Additionally, counselling was also made available by Normandy to the immediate family. 8 The action items implemented by Normandy and subsequently Unimin are as follows: (a) the development of a Mine Management Safety Plan specific to the Mine and that complies with the DMR and Unimin guidelines; (b) the documenting of an Organisational Chart and the allocation of responsibilities to people working at the Mine; (c) a review of hazards and high-risk activities associated with the Mine to ensure that JSA's had been completed for high risk activities; (d) a review to ensure that all employees undertaking high-risk activities are appropriately qualified at the Mine; (e) the development and implementation of a work permit system for specified tasks at the Mine; (f) the development of a hazardous substance register and the upgrading of hazardous substance storage areas to appropriate Australian Standards where required; (g) implementation of procedures for material safety data sheets distribution and storage for all dangerous substances at the Mine; (h) the development and implementation of additional awareness, education and training programs for employees in relation to site hazards and hazardous substances. (i) the implementation of documented procedures for the use and maintenance of fire extinguishers. (j) the appointment of a new production manager to the Mine; (k) the completion of a review of the induction and training provided to new employees, contractors and visitors to the Mine; (l) the development of a formal schedule for the maintenance of all fixed and mobile equipment at the Mine; (m) the completion of a full site risk assessment and the development of a hazard register which specifies appropriate control measures; (n) the erection of appropriate signage around the Mine; (o) the completion of a review to ensure all relevant legislation, standards, codes of practice and guidelines had been identified by the Mine; (p) a review to ensure that all relevant safety policies, safety alerts, correspondence and emergency evacuation procedures were displayed on notice boards, office walls and other appropriate areas at the Mine; (q) the attendance of all Mine staff at the Department of Mineral Resources Small Mines Awareness course; and (r) the documentation of all Toolbox meetings, with the minutes of the meetings being made available to all staff. 9 Mr Jones also dealt with the continuous improvement of the OH&S management system within Unimin. Since acquiring Normandy on 1 July 2000, Unimin has continued to acquire other Australian assets. On an acquisition it undertakes a detailed review of OH&S management systems and practices at those sites and commences its ongoing programs to improve OH&S management. It has developed a new environmental, health and safety management system across all of its operations which places greater responsibility, resources and authority for managing environmental, health and safety issues at the site level. This approach has led to increased involvement by the site in safety issues. Each site has been provided with guidelines on risk assessment specific to the activities undertaken at that site. They also have a designated Safety Environment Co-ordinator who is responsible for ensuring that site specific issues are identified, assessed and controlled and for co-ordinating the development of a site specific EH&S Procedure Manual. They have been provided with information on EH&S compliance requirements including Australian Standards specific to activities undertaken at that site. 10 Mr Jones also dealt with, in the context of the new Unimin EH&S System, aspects of policy, documentation, resources, training and supervision, audit and continuous improvement. 11 Mr Scott of counsel for the prosecutor submitted that it was difficult to imagine a more dangerous activity than that in which the two employees were engaged. Having put 45 litres of diesoline into the tank to act as a medium to identify where the cracking in the welding or brazing occurred, they forced air into the tank to pressurise it. This was occurring in the hot sun in Scone in February. The fumes of the diesel ignited and burning diesel was sprayed over Mr Davenport. Mr Davenport lacked any training in welding or brazing. He submitted that the risk involved in this matter was foreseeable and was a very high level of risk. The potential consequences of the risk were very extreme. 12 It was accepted for the prosecutor that Normandy should be given credit for the steps they have taken in response to the accident and for their early plea entered in the matter. However, the risk being severe makes this a very serious matter which should be dealt with in that light. 13 For Normandy, Mr Hodgkinson of senior counsel submitted that while the defendant as the one legal entity has pleaded guilty to the charge, a significant matter is that the ownership of that entity is now different. The facts concerning the charge cannot be acts and omissions on the part of the present "owner", except in the formal sense. In assessing the culpability in the hands of the defendant before the court, a significant matter of weight is that the court is dealing with a responsible corporate citizen in the occupational health and safety sense. The court will know, when formulating the penalty to be imposed, that this incident was not of its making although it bears the legal responsibility for it. 14 Here, Mr Davenport was statutorily appointed to hold the senior position on the site. The statutory supervision scheme adopted by the Mines Inspection Act had been complied with. It was submitted that the person charged appropriately with the running of the mine in all its aspects is the person who makes the decision that led to this tragedy. It is of little consequence that the General Manager of the defendant was located in Queensland. Here, there was a properly appointed supervisor with the necessary statutory requirements being met making decisions not otherwise communicated. Ultimately, the particulars amount to the proposition that Normandy did not prohibit Mr Davenport from undertaking this work. Even there, however, the defendant is compromised because the welding equipment was not owned by it. It would be a different case if the defendant had provided equipment for use by personnel not skilled in its use. It was submitted the inference was that Mr Edmonds, the employee who had provided the welding equipment, and was assisting in the task, also did not perceive the circumstances to be dangerous. Conclusions 15 In considering the nature and quality of the offence involved in this matter, a number of features are relevant. It is apparent from the fact of undertaking the work that either Mr Davenport and Mr Edmonds did not appreciate the dangerous nature of the activity or, knowing the dangers continued regardless. It is difficult to understand why the work would have been done this way in either case. However, difficult as it is to accept the position, it seems to me it more likely they did not consider the dangers involved. One difficulty I have had in forming that view is the question whether the apparent absence of knowledge, if not a simple lack of care, derived from the absence of a material safety data sheet dealing with diesel fuel or knowledge of Australian Standards in relation to hot work in that context or some other readily available guidance in the matter. In any event, the particulars of the defendant's failure, relating to appropriate skill, lack of adequate supervision and inadequate arrangements relating to the use and handling of diesel fuel through not maintaining a register of hazardous materials or a material safety data sheet, are accepted by the defendant's plea of guilty. 16 While on one level one has difficulty in comprehending the foreseeability of the process which culminated in an action as obviously dangerous as this one, it is now well-recognised that one purpose of the Act is to protect, through the application of suitable levels of protection by the employer, even "foolish disregard of personal safety" (see per Bauer J in WorkCover Authority of New South Wales (Inspector Twynam-Perkins) v Maine Lighting (1995) 100 IR 248. However, aspects of the matter of foreseeability which raise some difficulty in the context of culpability are the bringing on to site of welding equipment not otherwise provided and undertaking thereby a metal fabricating task which normally would have been done off site. These features, together with the inherent unlikelihood of a problem of this kind occurring, seem to me to lead to the conclusion that the culpability of the defendant is not at a high level. That is, it would be inappropriate in these circumstances to assess that culpability in line with the risk inherent in the precise task undertaken. It is only once one comes to the point of commencing the fabricating or, more particularly, the brazing task in the face of the facts of the presence of diesoline, a pressurised container and heat that a serious, indeed very serious, risk emerges. 17 Further, while the defendant has accepted the particular of the charge concerning inadequacy of supervision, culpability again seems to me to involve a consideration of the fact that the deceased employee was the statutorily appointed Mine Manager and the person on site responsible for the supervision of safe working. 18 The material tendered and the evidence relating thereto satisfies me that Unimin is taking a commendable approach to occupational health and safety with a view to conformity with legal requirements and the avoidance of accidents. The evidence suggests that the new approach has reduced to a noticeable degree the lost time injury frequency rate within Unimin's acquired operations. This material establishes that Unimin is taking a serious approach to its responsibilities for occupational health and safety, for which it is entitled to credit in the assessment of penalty. I give weight to the fact that whilst the defendant remains the same legal entity, the change in ownership has produced the beneficial result with respect to OH&S management to which I have referred. 19 These features of the case suggest to me that the matter should not be viewed in the upper realms of seriousness but should be regarded as in the low range. Coming to that view, I have given consideration to the absence of matters such as material safety data sheets and the like and the fact that Normandy's then practices permitted the development of the circumstances which gave rise to the exposure to risk. 20 I take into account the defendant's early plea for which I would afford it, in the light of the prosecutor's submissions, a 25% reduction in penalty. I also take into account the absence of prior convictions, its cooperation with the prosecutor and, importantly, the subjective matters going to a greatly enhanced approach to safety introduced since the advent of the Unimin ownership, which has a favourable effect in the context of a special deterrence. I also take into account the need to reflect in penalty the requirements of general deterrence. 21 I consider the appropriate level of penalty, before discounts, to be $65,000. I convict the defendant of the offence charged and impose a penalty of $42,250 with a moiety of penalty to the Department of Mineral Resources. The defendant shall pay the prosecutor's costs in an amount as agreed or if necessary assessed by the court. Liberty to apply if necessary in that regard. 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.