Industrial Relations Commission of New South Wales in Court Session CITATION : Inspector Childs v Royce Roofing Services [2003] NSWIRComm 38 PROSECUTOR Inspector Barry Childs PARTIES : DEFENDANT Royce Roofing Services Pty Limited FILE NUMBER: IRC 3043 of 2001 CORAM: Boland J CATCHWORDS : Occupational Health and Safety - Section 15(1) of the Occupational Health and Safety Act - Employees injured when roof they were loading asbestos sheets on collapsed - No formal risk assessment performed - No harnesses used - Early plea of guilty - Personal hardship of sole director of defendant - Offence proven - Penalty imposed Construction Safety Regulations 1950 Fines Act 1996 LEGISLATION CITED : Occupational Health and Safety Act 1983 Occupational Health and Safety (Asbestos Removal Work) Regulation 1996 Supreme Court (Summary Jurisdiction) Act 1967 Camilleri's Stock Feeds Pty Limited v Environmental Protection Authority (1993) 32 NSWLR 683 Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610, 99 IR 29 Department of Mineral Resources of NSW (Chief Inspector Bruce Robert McKensey) v Kembla Coal and Coke Pty Ltd (1999) 92 IR 8 CASES CITED : Haynes v C I & D Manufacturing Pty. Limited (No. 2) (1995) 60 IR 455 Lawrenson Diecasting Pty Ltd v WorkCover Authority of NSW (Inspector James Swee Ch'ng) (1999) 90 IR 464 R v Burrell (2000) 114 A Crim R 207 R v Carmody (1998) 100 A Crim R 41 R v Osenowski (1982) 5 A Crim R 394 HEARING DATES: 11/14/2002 DATE OF JUDGMENT: 02/20/2003 PROSECUTOR Mr D B O'Neil of counsel Solicitor: Mr J Simpson Phillips Fox Solicitors LEGAL REPRESENTATIVES: DEFENDANT Mr G W McGrath of counsel Solicitor: Mr R Storey JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: Boland J Date: 20 February, 2003 Matter No IRC 3043 of 2001 INSPECTOR CHILDS v ROYCE ROOFING SERVICES PTY LIMITED Prosecution under s 15(1) of the Occupational Health and Safety Act 1983 JUDGMENT [2003] IRComm 38 1 This is a prosecution by Inspector Barry Childs of the WorkCover Authority of New South Wales. In an amended application for order under s 4(1) of the Supreme Court (Summary Jurisdiction) Act 1967 filed on 11 June 2002 the Inspector alleged that the defendant, Royce Roofing Services Pty Limited, failed to ensure the health, safety and welfare at work of its employees contrary to s 15(1) of the Occupational Health and Safety Act 1983. 2 It was alleged that the defendant failed to ensure the health, safety and welfare at work of its employees, in particular, Brett Culey, Paul Dibiasi, Craig Gibbons, Ralph Hip-Waye and Thomas McConkey in that it failed to provide or maintain a system of work for the removal of asbestos cement sheeting from the roof of a building at premises located at 1 Ivy Street Botany ("the removal operation") that was safe and without risks to health. In particular, it was alleged the defendant failed to: (a) Provide adequate health and safety induction training to employees carrying out the removal operation; (b) Ensure that its employees received adequate information concerning the removal of asbestos cement sheeting from roof structures; (c) Ensure an adequate system of fall protection for employees carrying out the removal operation. 3 The applicant was involved in removing asbestos cement roofing from a building at premises located at 1 Ivy Street Botany. As a number of workers, including employees of the defendant, were in the process of removing the roofing a section of the roof that the workers were standing on collapsed. A number of the workers were injured. The defendant entered a plea of guilty to the charge. 4 The agreed statement of facts described the incident as follows: The injured employees and approximately ten other workers of the defendant commenced the removal operation at the premises at approximately 6.30 am on 8 May 1999. The injured employees commenced stripping the asbestos cement sheeting from the northern side of the roof gable of the building and then carried the sheets to the eastern end of the roof placing it in approximately six stacks, three on each side of the gable. The injured employees had stripped about 75% of the roof sheeting and then ceased stripping work because the stacks of asbestos cement sheets were becoming too large. A power crane was being set up at the side of the building in order to lift the stacks of asbestos roof sheeting from the roof of the building. Approximately fifteen workers of the defendant including the injured employees were waiting for the crane to commence lifting the stacks of sheeting from the roof when there was a loud cracking noise and a section of the roof that the workers were standing on collapsed. Some of the workers were able to make it to safety, but the injured employees and one or more other workers fell through the collapsing roof to the floor of the building, a height of approximately five metres or more. … The injured employees suffered the following injuries: (a) Culey - fractured right kneecap - 3 months away from work; (b) Dibiasi - 2 swollen ankles, cuts and abrasions to his left leg - approximately 1 month away from work; (c) Gibbons - lacerations to arm, leg and chest - approximately 1 week away from work; (d) McConkey - bruising to right side buttock - approximately 1 month away from work. 5 There were two affidavits filed into evidence. The first was that of Mark Phillip Speechley, project manager for the defendant. Mr Speechley had been a roof plumber for some 14 years and involved in the removal of asbestos roofing for the last 12 years. In April 1999, following the severe hail storm that hit parts of Sydney in that month, Mr Speechley prepared a quotation for the removal of a storm damaged roof owned by James Hunter & Sons Pty Limited at 1 Ivy Street Botany. The quotation was accepted and work commenced on 8 May 1999. 6 Mr Speechley's affidavit goes on to describe what occurred on 8 May 1999. I note in the affidavit that Mr Speechley said that not all of the defendant's employees and contractors were "TAFE trained in the removal of asbestos and those who are not so qualified only do other roofing work." Nevertheless, three of the defendant's employees working on the roof on 8 May 1999 had no training at all in relation to asbestos removal. The fact that these three employees were only involved in the stacking of the asbestos sheeting as opposed to removing the sheeting from the roof is, in my opinion, too fine a distinction; the employees were involved in the process of removing asbestos sheeting without having had the necessary training required by the Construction Safety Regulations 1950. 7 Mr Speechley referred in his affidavit to having been told by a "union representative" on a day prior to 8 May 1999 to the effect that "Your workers can work on this job as long as they work with someone who has done the course (TAFE) and as long as they are booked into the next available course." If that is suggested in some way as mitigating the defendant's failure to ensure the health and safety of its employees then it does not. A statement to this effect by a union representative carries no authority and cannot be relied upon. 8 Mr Speechley also said that "Harness and reels were always supplied by Royce but were not required to be used at all times for this job as the existing asbestos roofing had been installed with wire beneath it." This was not to imply that the wire was adequate fall protection. The defendant in its plea conceded that the system of fall protection was not adequate. As to risk assessment Mr Speechley said he had carried out a risk evaluation of the job although it was not in writing. However, Mr Speechley did not inspect for structural soundness, including an inspection from below as laid down in s 2.4(c) (iii) of the Code of Practice, Safe Work on roofs, Part 1, Commercial and industrial buildings. 9 Mr Speechley said in his affidavit that "As was my usual practice, I held a site meeting at the factory and told the workmen what was being done and what each of them were to do. I also checked to ensure that everyone had the appropriate gear." It was conceded by the defendant, however, that there was no mention of occupational health and safety issues at the meeting. 10 A further affidavit by Michael John Gollop was tendered in the proceedings. Mr Gollop is the managing director, sole director, secretary and shareholder of the defendant. Mr Gollop said in his affidavit that: · The defendant had been operating sine 1983. · Investigation into the cause of the roof collapse by experts revealed there were defects in the structural connection between the timber purlins and the end gable wall and that when the extra load involved with the stacked asbestos roofing occurred the roof collapsed. Further, that the structural deficiency would not have been apparent from a visual inspection, even to an expert, as the connection of the purlins to the brick gable wall was inside the wall and not visible. · The defendant has no prior convictions. · There are inherent dangers in carrying out roof work and therefore safety has always been paramount in Mr Gollop's mind. Between 1986 and 1988 he was involved in the preparation of the draft code of practice and recommendations for safe work. · The defendant had its own occupational health and safety documentation several years prior to 2001. The defendant had implemented its own list of Safety Guidelines that were given to employees who were required to read and sign a copy on commencing employment with the defendant. · The defendant gave employees formal instructions on the use of safety harnesses and tagging of electrical gear and supplied inertia reels, harnesses and safety lines to each employee. · The defendant had a standard procedure for its site managers to do a risk assessment of the site. · After the accident the defendant took steps to avoid a recurrence and this included declining to accept any work involving buildings of the age, structure, type and condition as the building at 1 Ivy Street Botany; all employees to undertake appropriate formal training courses; all employees to sign a work method and site safety form statement; making it obligatory for a risk assessment to be undertaken by a structural engineer before work commences on a site; improve the operation of the Safety Committee. · James Hunter & Sons Pty Limited has served a statement of claim on the defendant alleging negligence in carrying out the roofing work and claiming damages. The claim is being defended. · Due to financial factors not of its own making the defendant cannot afford extra substantial costs in the short to medium term. It would result in the loss of jobs if the defendant's cash flow position deteriorates. · In the past six years Mr Gollop has suffered some traumatic events in his family that have affected him personally, financially and psychologically including the need to care for a son with spina bifida who is unable to live on his own and whose prognosis is poor and another son who had contracted HIV and was addicted to heroin. He committed suicide in 1998. 11 Other material placed into evidence was a bundle of photographs showing the location of the incident and its aftermath in terms of the collapsed roof, and a further photograph showing the wire mesh. A statement by Mr Robert Storey, solicitor, regarding Mr Gollop's personal and family circumstances was also tendered. 12 Mr D B O'Neil of counsel appeared for the prosecution. He provided a written outline of submissions dealing with: the relevant legal principles; the relevant factual matters in assessing the objective seriousness of the offence; the grave risk to injury; the degree of foreseeability; the existence of simple remedial steps to avoid the accident; the early plea of guilty by the defendant; the post-incident steps taken by the defendant to improve safety; that the Court is entitled to view the offence as an aberration; deterrence; capacity to pay; and, the defendant's standing as a good corporate citizen. 13 Mr O'Neil also submitted that the defendant was a substantial business and for the purpose of sentencing should not be regarded as a one-man operation. 14 Mr G W McGrath of counsel appeared for the defendant. Mr McGrath's submissions may be summarised as follows: · The defendant is a long established company in the roofing industry, has a good safety record and pleaded guilty at the first available opportunity. · The defendant had occupational health and safety documentation in place prior to the accident and had designed an individual fall safety device. Employees were required to undertake TAFE qualifications and WorkCover courses and to obtain relevant certificates. · The defendant is well regarded in the industry and has done charity work. · The failures by the defendant were not the primary cause of the accident. According to expert opinion the frame collapse was due to poor design and construction. The chances of identifying the structural deficiencies, which were covered, was remote. That the roof would collapse was not foreseeable. The reasons for the collapse reduces the culpability of the defendant. · The defendant has gone to considerable expense and trouble to ascertain the cause of the accident and to prevent a recurrence of the risk to safety. · There are hardship factors of a personal nature involving the owner of the defendant, Mr Gollop. The personal factors in the case are such that they could reasonably lead a court to conclude that a sense of mercy required that such hardship be taken into account: see R v Burrell (2000) 114 A Crim R 207 at 231; R v Carmody (1998) 100 A Crim R 41 at 45; R v Osenowski (1982) 5 A Crim R 394 at 394. The Verdict 15 After reviewing the agreed facts and in light of the charge and the particulars thereof, I am satisfied that the offence has been proven. The plea of guilty by the defendant was properly made and I enter a verdict accordingly. Consideration 16 The first consideration is the objective seriousness of the offence charged in terms of its nature and quality. Removal of asbestos is a dangerous occupation and is recognised as such in legislation by the need for persons to be licensed to perform such work: see Occupational Health and Safety (Asbestos Removal Work) Regulation 1996. Construction work also has its inherent dangers as recognised in the Construction Safety Regulations and Codes of Practice. The Regulations require site specific occupational health and safety induction training which is to cover the relevant health and safety topics set out in the "Code of Practice - Occupational Health and Safety Induction Training for Construction Work 1998". 17 Working on roofs has its own extensive code of practice and deals specifically with procedures to prevent falls during the removal of asbestos cement roofing. 18 Against that background of regulations and codes of practice the defendant had a large number of workers (15) on a roof in respect of which it had no proper knowledge of the safety and stability of the structure. Moreover, while the workers remained on the roof the asbestos sheeting was stacked in piles on the roof waiting to be removed by crane, thereby increasing the load on the roof. Indeed, the workers had to stop stripping the sheets from the roof because the piles of sheeting had become too large. The workers were not using fall protection and no proper inspection was made of the wire mesh in the roof to determine whether it met the requirements of the relevant code of practice to prevent falls. 19 Contrary to the requirements of the relevant Regulations the employees on the roof did not receive adequate induction training regarding health and safety issues and the defendant did not ensure that its employees received adequate information concerning the removal of asbestos sheeting from roof structures. Further, the defendant did not ensure an adequate system of fall protection was in place. 20 Whether the risk to safety was reasonably foreseeable is a consideration relevant to the seriousness of the offence: Lawrenson Diecasting Pty Ltd v WorkCover Authority of NSW (Inspector James Swee Ch'ng) (1999) 90 IR 464 at 476. I agree with the prosecution that it was clearly foreseeable that substantial risk attached to the factual scenario in this case. 21 A further consideration in assessing the seriousness of an offence is the existence of simple and straightforward remedial steps to avoid the risk to safety: Department of Mineral Resources of NSW (Chief Inspector Bruce Robert McKensey) v Kembla Coal and Coke Pty Ltd (1999) 92 IR 8 at 27. The availability of simple remedial steps are obvious: The roof should not have been loaded to the extent it was and employees should have left the roof area whilst waiting for the crane to lift the sheeting down from the roof. 22 The maximum penalty in this case is $550,000. The penalty reflects the public expression by Parliament of the seriousness of the breach: Camilleri's Stock Feeds Pty Limited v Environmental Protection Authority (1993) 32 NSWLR 683 at 698-699. 23 In considering the objective seriousness of the offence I have taken into account the experts' reports on the cause of the roof collapse and the difficulty of detecting the deficiencies in the structure. I have also had regard to the defendant's safety procedures and practices at the time of the incident. I would comment, however, that notwithstanding these considerations, the defendant's safety systems were seriously deficient. Whilst it might be contended that the cause of the roof collapse was deficient design and construction the fact is that the defendant, after only a cursory inspection of what was a 40 year old roof, allowed a very substantial load to be placed on the roof without sufficient regard to the safety of the employees working on the roof. 24 Having regard to the foregoing considerations I conclude that the offence was serious. There are a number of matters, however, to be taken into account in mitigation. Firstly, the prosecution concedes there was an early plea of guilty. Secondly, the defendant has taken steps to improve workplace safety and to avoid a recurrence of the risk to safety that occurred on 8 May 1999. Thirdly, the defendant has a good safety record and has no prior convictions. Fourthly, I accept the defendant's standing as a good corporate citizen. 25 In relation to deterrence, the principles were discussed by a Full Bench of this Court in Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610; 99 IR 29 at pars [71] - [80]. I adopt that discussion for the purposes of determining sentence in this case. As to general deterrence, the important consideration is to set the penalty at a level that will realistically operate as a deterrent but not so high as to be oppressive. As to specific deterrence, I am satisfied that the likelihood of the defendant re-offending is low and, therefore, specific deterrence is not a significant element in my consideration as to penalty. 26 As to Mr Gollop's personal and family circumstances, I accept that they must be a serious burden for him and one can have nothing but sympathy for his plight. Mr McGrath submitted that the Court should take these circumstances into account in determining sentence. Mr McGrath sought to rely on a number of cases where courts had taken into account the hardship that would be caused if the defendant was deprived of his or her liberty and became unable to act as a carer for someone who depended on them for care. 27 In these proceedings the penalty to be imposed is a fine and not imprisonment. In order for the Court to consider mitigation of the penalty it would be necessary for Mr Gollop to show that the fine would cause such hardship to him - for example, deprive him of funds necessary to provide proper care for his disabled son - that the Court should impose a lesser fine than might otherwise be the case. 28 The material provided by Mr Gollop as to the financial position of the defendant, including the defendant's means could not be described as fulsome and it was not put to the Court that the defendant was incapable of paying any fine that was imposed. 29 I note further that these proceedings involve a prosecution of a corporate entity in which Mr Gollop is involved and not Mr Gollop personally, although I understand that there is an outstanding prosecution in relation to Mr Gollop under s 50(1) of the Occupational Health and Safety Act that has been stood over generally. 30 Nevertheless, the approach to follow in sentencing under the Occupational Health and Safety Act where a defendant is a small corporation was dealt with by a Full Court (Bauer, Hungerford and Cullen JJ) in Haynes v C I & D Manufacturing Pty. Limited (No. 2) (1995) 60 IR 455 at 457 in the following way: An issue to which the court was taken obliquely was the manner in which we should deal with pleas of impecuniosity when considering the fine to be levied. The penalty which the legislature has made applicable to breaches of the OHS Act is a fine, and, as was pointed out by Cullen J in Gordon v MIJO (NSW) Pty Ltd (unreported, Cullen J, 2 December 1993, Matter No CT1002 of 1993), the legislature itself introduced a differentiation of penalty by providing that there should be a different penalty for corporate defendants from that for personal defendants. In a number of cases decided under the OHS Act where the corporate structure of the defendant has been shown to be little more than the means of distribution of earnings arising from personal exertion, or where, as a matter of corporate structure, the burden of any fine levied would fall on one person or one family group ownership, the Court has seen it appropriate to impose a fine substantially less than if the corporation was functioning as a company with assets of a substantial kind. (See Gordon v MIJO (NSW) Pty Ltd; Ford v Warrah Ridge Pastoral Company Pty Ltd (unreported, Bauer J, 23 September 1994, Matter No CT1109 of 1993); Robins v C T Plumbing Pty Ltd (unreported, Fisher P, 16 December 1991, Matter No 522 of 1991) and Mauger v Krcmar Engineering Pty Ltd (1993) 47 IR 359). We consider that as precedent has developed there are two strands to the consideration of fines under the OHS Act. The first comes into play when the defendant is an individual and there is no corporate structure. Where the defendant is a company with the structure as above considered, the principles and approach adopted in the cases above cited are to be applied. 31 Section 6 of the Fines Act 1996 provides that: 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 to the fixing of that amount. 32 I am prepared to take into account the fact that Mr Gollop is the sole director and shareholder of the defendant and the burden of any fine will fall on him. I also take into account Mr Gollop's personal hardship and the effect that a fine may have on his capacity to care for his son. 33 In considering an appropriate penalty in this case I have considered the objective seriousness of the offence as well as subjective factors including the utilitarian value of an early plea of guilty, that the defendant has taken steps to improve workplace safety and to avoid a recurrence of the risk to safety that occurred on 8 May 1999, the defendant's good safety record and the fact it has no prior convictions and the defendant's standing as a good corporate citizen. 34 In all the circumstances I would assess an appropriate penalty at $75,000. Given the early plea of guilty I would allow a discount of 25 per cent with a further discount of 10 per cent for the other subjective factors leaving a penalty of $48,750. Orders 35 The Court makes the following 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 $48,750 with a moiety thereof to the prosecutor. 4) The defendant shall pay the prosecutor's cost of the proceedings in an amount as agreed or, if agreement cannot be reached, leave is granted to either party to approach the Court for final orders 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.