Industrial Court of New South Wales CITATION: Inspector Melissa Chaston v Sacco Builders Pty Ltd and Others [2008] NSWIRComm 152 This decision has been amended. Please see the end of the judgment for a list of the amendments. PROSECUTOR: Inspector Melissa Chaston PARTIES: DEFENDANTS: Sacco Builders Pty Ltd Kaydee Engineering Pty Ltd James Wilfred Cunningham FILE NUMBER(S): IRC 929; 931 and 934 of 2007 CORAM: Backman J CATCHWORDS: Occupational health and safety - Occupational Health and Safety Act 2000 - s 8(1), s 8(2) and s 26 - pleas of guilty entered by each defendant - fatal accident involving boom lift of crane while working at height - fatally injured worker a trainee - the risk to safety and forseeability of the risk - general deterrence - specific deterrence - consequences of breaches - systems in place prior to offences - respective culpabilities - subjective factors - relevance of changed adverse personal and emotional circumstances of a defendant directly arising from the circumstances of the accident - capacity to pay a fine - victim impact statements - penalty - orders Crimes (Sentencing Procedure) Act 1999 LEGISLATION CITED: Fines Act 1996 Occupational Health and Safety Act 2000 Occupational Health and Safety Regulation 2001 Inspector Aldred v Herbert and others [2007] NSWIRComm 170 Inspector Stephen Cooper v Franklin Alden Coveney and Another [2008] NSWIRComm 80 CASES CITED: WorkCover Authority (NSW) (Inspector Jones) v Challita (2006) 153 IR 409 WorkCover Authority of New South Wales (Inspector Downie) v Menzies Property Services Pty Ltd (2004) 136 IR 449 WorkCover Authority of New South Wales (Inspector Patton) v Fletcher Constructions Australia Ltd (2002) 123 IR 121 HEARING DATES: 5 February 2008 DATE OF JUDGMENT: 15 August 2008 PROSECUTOR: Mr R Reitano of counsel WorkCover Authority of New South Wales (Mr D Allen) DEFENDANT: (Sacco) Mr M J Johnston of counsel Wight & Strickland LEGAL REPRESENTATIVES: (Mr P Zacharatos) DEFENDANT: (Kaydee) Mr I C Latham of counsel Beston Macken McManis Solicitors (Mr H I Macken) DEFENDANT: (Mr Cunningham) Norton White Lawyers (Mr R Picone) JUDGMENT: INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: BACKMAN J Friday, 15 August 2008 Matter No IRC 929 of 2007 Inspector Melissa Chaston v Sacco Builders Pty Ltd Prosecution under section 8(2) of the Occupational Health and Safety Act 2000 Matter No IRC 931 of 2007 Inspector Melissa Chaston v Kaydee Engineering Pty Ltd Prosecution under section 8(2) of the Occupational Health and Safety Act 2000 Matter No IRC 934 of 2007 Inspector Melissa Chaston v James Wilfred Cunningham Prosecution under section 8(1) and section 26 of the Occupational Health and Safety Act 2000 JUDGMENT OF THE COURT [2008] NSWIRComm 152 1 Sacco Builders Pty Ltd (Sacco), Kaydee Engineering Pty Ltd (Kaydee) and James Wilfred Cunningham (Mr Cunningham) each pleaded guilty to offences under the Occupational Health and Safety Act 2000. Sacco and Kaydee each pleaded guilty to one offence under s 8(2) of the Act, and Mr Cunningham pleaded guilty to one offence under s 8(1) and s 26 of the Act. 2 The three offences arose out of the same incident which occurred on 3 June 2005 at 29 Governor Macquarie Drive, Chipping Norton where fifty factory units were under construction. Sacco was the project manager at the site. It contracted Ronald John McGeoch to be responsible for safety at the site. Mr McGeoch's responsibilities were to prepare a site safety plan, review work methods of subcontractors, and carry out safety inspections during construction. Both he and Sacco were responsible for implementing the safety plan at the site. Sacco also engaged Dario Traini as site foreman. His duties encompassed supervision of the construction of the fifty factory units. He was also responsible for the implementation of the site safety plan. 3 Mr Sacco, a director of Sacco, was ultimately responsible on behalf of Sacco for safety at the site. Mr Sacco met on a weekly basis with Mr Traini to discuss safety issues and to conduct site inspections. If safety issues were raised, Mr McGeoch was to be contacted. 4 Sacco contracted Kaydee to supply and erect structural steel beams. Kaydee employed Simon Beddow as a manager with responsibilities which included quoting, liaising with the Kaydee supervisor in the workshop, visiting and attending site meetings, and implementing Kaydee's occupational health and safety systems at the site. Simeon Alexander Haddad was the sole director of Kaydee. His role at the site included making decisions for Kaydee with respect to the supply, installation and erection of the structural steel beams. Mr Haddad visited the site once or twice a week. 5 Kaydee contracted Sydney Metro Cranes Pty Ltd (SMC) to erect the structural steel beams at the site, and operate a boom lift, also known as an elevating work platform (EWP) at the site. SMC commenced work at the site on 7 March, 2005. 6 Mr Cunningham was a director of SMC and a supervisor at the site. SMC employed Mark Gallace as a rigger on 29 April, 2005. His normal duties involved assisting crane drivers slinging, and directing the movement of the crane, and tying the nuts and bolts for fixing steel beams at the site. Mr Gallace was a trainee in the use and operation of the EWP. He received "on the job" training. Robert Freeland was the site foreman for SMC and Mr Gallace's "designated supervisor." 7 SMC contracted with Millennium Access Rentals Pty Ltd (Millennium) for the supply of a Haulotte Australia Pty Ltd boom lift to be used at the site between 29 April 2005 and 3 June, 2005. 8 On 3 June 2005, workers employed by SMC were craning materials and fixing steel roof purlins (beams) into position at the site. Mr Gallace carried out the daily safety check and routine maintenance on the boom lift. He later recorded the work done in the EWP Safety Check and Routine Maintenance Log Book and signed it. Mr Gallace and Mr Freeland tightened the bolts of splice plates over the joints of the metal roof purlins which had been placed into position at roof level. The task was carried out from the platform of the boom lift at a height of 7.7 metres above ground level. 9 Between 9:30am and 10:30am Mr Traini was conducting the site rounds when he noticed that Mr Gallace's harness lanyard was not connected to the anchor point of the basket of the boom lift. He advised Mr Cunningham who immediately directed SMC employees to cease work and gather at ground level. He then verbally instructed the workers to attach the lanyards of their harnesses when working from the platform of the boom lift. 10 Sometime before lunch Mr Gallace commenced work in factory unit number 1. Mr Freeland worked in unit number 3. After lunch Mr Gallace returned to unit number 1 and continued to tighten up bolts to each of the purlins placed at roof level. At that time he was working alone in the bucket of the boom lift, located 7.7 metres from the ground. 11 About 25 minutes after lunch Mr Cunningham saw Mr Gallace apparently stuck between one of the purlins and the boom lift platform's hand safety rail. The purlin was pressed against Mr Gallace's chest and his body was bent backwards over the basket of the boom lift. He did not respond when Mr Cunningham called out to him. Mr Cunningham attempted to free Mr Gallace by operating the boom lift from the ground controls. He lowered the boom down to some six metres from ground level. As he did so, Mr Gallace tumbled to the ground. Both Mr Cunningham and Mr Freeland observed that Mr Gallace's lanyard, which was attached to the back of his harness, had not been clipped onto the boom lift platform. The agreed statement of facts incorporated an extract from an expert's report which contained the results of an inspection of the boom lift. The extract advanced an opinion that the boom lift platform was being driven by Mr Gallace at the time of the accident but that he had been unaware of the distance that would be travelled by the boom lift at high speed, rather than low speed. It emerged in the evidence (contained in the expert's report) during the sentence hearings, that there was a fault in the safety drive speed over-ride system. The over-ride system, if it had been operating correctly, should have automatically switched the machine to slow speed when the boom was raised past a certain angle. The fault may have resulted in the machine not switching to slow speed when it should have, instead continuing to operate at high speed. 12 The post-mortem report in relation to Mr Gallace found that his death was due to the combined effects of head injury and asphyxia. 13 Although each defendant's case on sentence was heard separately, the factual background and the factors which gave rise to the offences against the three defendants are substantially the same. The objective and subjective factors relevant to the cases brought against each defendant will be separately considered where necessary, and jointly considered where appropriate. The factors relied upon by each defendant in mitigation, will be given separate consideration. 14 Commencing first with the charges, the particulars of each of the defendants' failures to ensure safety are expressed in identical terms. They are: The failure to provide a safe system of work for people operating or using a boom type elevating work platform ("the plant") at the site. The failure to undertake an adequate risk assessment for work being undertaken by people whilst using or operating the plant in or near roof purlins. The failure to ensure that people working on the plant were properly trained, instructed and supervised. The failure to ensure that people were adequately protected from falls from height by ensuring they wore harnesses that were properly affixed to prevent such falls. The risk to safety and foreseeability of the risk 15 At the time of the accident Mr Gallace was a trainee working alone at a height of over seven metres. Mr Gallace had been at the site only five weeks. The work he was undertaking when he was fatally injured was extremely dangerous. It involved operating the controls of the boom lift while adjusting bolts at roof level on the metal roof steel purlins, or beams. His nearest co-worker was Mr Freeland who was working in another factory unit some (undisclosed) distance away. The work which Mr Gallace was performing was "scheduled work" under clause 266 of the Occupational Health and Safety Regulation 2001 (the regulation). Under clause 271, a trainee (such as Mr Gallace) was permitted to do "scheduled work to which a recognised course of training in which the trainee is engaged, relates", only if that trainee performed the work under supervision and kept and maintained a record of training in accordance with requirements under clause 275 of the regulation. 16 According to the agreed statement of facts, Mr Freeland was Mr Gallace's "designated supervisor". The title meant that he was required to hold a certificate of competency in the use and operation of the boom lift. During the investigation, however, Mr Freeland could not produce his certificate of competency and the investigation was unable to reveal whether Mr Freeland in fact had such a certificate. Nor, it appears, did Mr Freeland provide any instruction to Mr Gallace on the operation of the boom lift. Instead, he relied on his own observations to reach a view that Mr Gallace was competent to operate the machine. This failure to ensure that Mr Gallace was properly instructed in the operation of the boom lift was most regrettable, and a serious error of judgment. The operation and maintenance manual for the machine was attached to the prosecutor's tender bundle on sentence. It sets out comprehensive instructions on the operation of the machine and emphasises the many hazards and risks associated with that operation, as well as the need to ensure an operator has been properly trained and instructed in the use of the machine. It also emphasises the importance of basic training in addition to the importance of the operator familiarising himself or herself with the information set out in the manual. By way of illustration, the manual contains a number of safety recommendations, instructions, and residual risks which include the following: · only trained operators are allowed to use haulott self-propelling platforms [a reference to the boom lift] · a person familiar with the operation of the machine should be located at ground level so that if necessary they can operate the controls at ground level in an emergency situation or if directed by the person/s in the basket · before commencing work the operator must always assess overhead risks. 17 On the evidence none of these matters had been attended to, or brought to the attention of Mr Gallace, prior to his accident. Mr Gallace was not properly trained in the operation of the machine, no-one was present at ground level to operate the controls, and the overhead risks had not been assessed before Mr Gallace commenced the work. 18 In addition, the agreed statement of facts records that Mr Cunningham was the "responsible person" for Mr Gallace as a trainee for the "scheduled work", in the operation of a boom lift with a boom length of 11 metres or more. The significance of these matters was not fully explored in the evidence. Clause 273 of the regulation however sets out the responsible person's obligations in relation to a trainee doing scheduled work. It is instructive to extract the contents of the clause in order to demonstrate that none of the obligations referred to in the clause would appear to have been discharged by Mr Cunningham in relation to Mr Gallace's traineeship: 273 Responsible person's obligations (1) The person responsible for a trainee doing scheduled work must ensure that the following requirements are complied with: (a) the trainee must at all times be directly supervised by a supervisor designated by the person in accordance with subclause (2), unless the responsible person or supervisor has established: (i) that the trainee's competency makes direct supervision unnecessary, and (ii) that a lesser degree of supervision would not endanger the health or safety of the trainee or any other person, (b) the trainee must receive directions, demonstrations, training and monitoring appropriate to the work and commensurate with the competence of the trainee, (c) it must be possible for immediate remedial action to be taken in the event of an emergency arising out of the trainee's doing the work. (2) The person responsible for a trainee may designate a supervisor for the trainee only if: (a) the supervisor is a person who holds a certificate of competency or recognised qualification in relation to work of the kind being done by the trainee, or (b) if no such person is available, the supervisor is a person who belongs to a class of persons that the guidelines issued by WorkCover in relation to the supervision of trainees recognise as competent to directly supervise a trainee in the doing of the type of work concerned. (3) The person responsible for a trainee must ensure that the trainee keeps and maintains a record of training in accordance with clause 275. 19 Mr Freeland as Mr Gallace's "designated supervisor" also had obligations that he was required to discharge under clause 274 of the obligation. Again, in the case of Mr Freeland, it seems that none of the obligations set out in the clause were discharged by him at the time of Mr Gallace's fatal accident. For convenience, the clause is extracted below: 274 Supervisor's obligations (1) The supervisor of a trainee doing scheduled work must directly supervise the trainee while the trainee is doing the work, unless the employer of the trainee or the supervisor has established: (a) that the trainee's competency makes direct supervision unnecessary, and (b) that a lesser degree of supervision would not endanger the health or safety of the trainee or any other person. (2) A supervisor designated to supervise a trainee by the trainee's employer: (a) must ensure that the trainee keeps and maintains a record of training in accordance with clause 275, and (b) must check the record on each date on which the scheduled work is done by the trainee, and: (i) if satisfied that the record is correct in respect of that date, must sign the record on that date, or (ii) if not so satisfied, must make and sign on that date a note to that effect on the record. 20 These omissions demonstrate the seriousness of the offence to which Mr Cunningham pleaded guilty, insofar as the particulars of that offence allege failures with regard to training, instruction, supervision, as well as the failure to undertake an assessment of the risks. 21 With regard to the requirement to ensure that the trainee kept a record of training, the agreed statement of facts discloses that Mr Gallace's training logbook did include work entries from 28 April, 2005 until 3 June, 2005, but the columns in the logbook for filling in the names and signatures of the trainee and supervisor, were blank. 22 Sacco had a site safety plan which required the subcontractors to provide it with a copy of their own site safety plans and work method statements, prior to commencing work. The subcontractors were also required by Sacco to provide proof that employees had received instruction in the safe work statements. Mr McGeoch considered that it was the responsibility of SMC to identify where the boom lift was to be used and to change its work method statement accordingly. There were however, no documented safe work methods for the operation of boom lifts between the employers at the site. 23 Mr Traini, Sacco's site foreman undertook Mr Gallace's site specific induction. Mr Gallace was not inducted into the SMC safe work method statement, nor was he inducted into a safe work procedure for the fixing of structural steel beams prior to the accident. 24 Sacco had a site plant register but it did not require the workers at the site to produce relevant certificates before commencing to operate machinery. 25 Kaydee, through Mr Beddow as its manager, had responsibility for implementing the company occupational health and safety system, at the site. Kaydee provided a work method statement to Sacco for structural beam erection at the site, which was reviewed by Mr McGeoch. The work method statement was deficient because it did not incorporate any reference at all to risks associated with the operation of boom lifts under overhead structures or the method by which such risks might be eliminated. 26 These various omissions by the three defendants reveal serious breaches of safety at the site, and exposed Mr Gallace to a serious risk to his safety. 27 While operating the boom lift Mr Gallace was at risk to his safety by reason of the factors outlined above, which included his lack of proper training and instruction in the operation of the machine. Nor was he adequately supervised at the time of the accident. Instead he was a trainee, working alone, operating a machine with which he had little or no familiarity, at a height in excess of seven metres. In these circumstances the risk to his safety was not only obvious but reasonably foreseeable. General deterrence 28 Construction sites are notoriously hazardous work environments where serious accidents can, and do, occur when insufficient attention has been paid to matters of safety. Construction sites invariably accommodate any number of contractors and subcontractors with differing levels of experience, expertise and qualifications. Not infrequently, particular workers undertake discrete tasks in discrete areas of work such as maintenance, operation of machinery, building, design, construction and cleaning. Many of these workers are engaged in the short term on a specific task, and lack familiarity with the work site. With any number of personnel passing through a construction site at any particular time, it is imperative that safety matters are carefully designed, tailored to the particular requirements of workers, properly implemented and consistently maintained at all times. The creation, implementation and maintenance of safety systems also requires employers and other persons entrusted with safety responsibilities at these sites, to be ever vigilant in the detection of risks to safety so that prompt and effective measures can be taken to obviate and, where possible, eliminate those risks. This tragic accident is yet another example of the failures of persons entrusted with responsibility for safety at a construction site, to properly discharge their responsibilities, and ensure the safety of persons at the site. Consequence of breaches 29 Given the nature of the risk to which Mr Gallace was exposed, and the extent of the failures to ensure his safety on the part of each of the three defendants it may be readily concluded that the consequences of those failures would, in all likelihood, be serious. In my view Mr Gallace's death was a manifestation of the risk to safety to which he was exposed by reason of those failures to ensure he could safely undertake the work he was performing immediately prior to the accident. None of the defendants have contended otherwise. Specific deterrence 30 Specific deterrence is also an important element in the sentencing process. Sacco continues to operate in the industry. It employs two persons and engages subcontractors on demand. Its operations are limited to building and construction work within New South Wales. Kaydee also continues to operate in the industry, with its sphere of operations principally within New South Wales. It is a small family-owned company which has been in operation since 1969. At the time of the accident Kaydee employed 11 permanent staff. Both Sacco and Kaydee have implemented an impressive number of remedial measures designed to ensure that the circumstances of Mr Gallace's tragic accident are not repeated. These measures will be discussed in more detail later in the judgment. For present purposes they do not obviate the necessity to take into account the principle of specific deterrence in the sentencing process. I should add that all these measures would appear to have been available, and capable of implementation, at any stage prior to the accident. 31 Mr Cunningham's company, SMC, is presently in external administration. He was employed by a business and engaged in mobile crane work shortly after the accident. At the time of the sentencing hearing, Mr Cunningham was contemplating leaving the construction industry, particularly because of ongoing problems associated with coming to terms with the death of Mr Gallace. Specific deterrence in relation to Mr Cunningham is therefore of less significance than it otherwise is to Sacco and Kaydee. Nevertheless, it remains relevant to Mr Cunningham to the limited extent that he intends to remain in employment, although not in the construction industry. In the context of occupational health and safety offences, the application of the principle has particular significance and it is only in rare circumstances that its application will not be justified: see for general discussion of the principle WorkCover Authority (NSW) (Inspector Jones) v Challita (2006) 153 IR 409 at [32] to [35]. 32 The foregoing considerations compel the conclusion that the offences charged against each defendant were, objectively very serious. Systems of work in place prior to the offences 33 The objective seriousness of the offences is mitigated somewhat by the systems which were put in place by all three defendants at the site at the time of the offences. 34 Sacco had engaged Mr McGeoch to act as the site safety manager. His role included the preparation of a site safety plan for the project. He prepared such a document in December, 2004 before work was due to commence at the site. The site safety plan provided for monthly group meetings with subcontractors to discuss occupational health and safety issues, regular tool box talks, the submission of safe work method statements, issuance of site safety instructions to subcontractors, implementation of weekly and monthly safety checks undertaken by the foreman, and a system for reporting workplace incidents. Mr McGeoch's role also included the review and verification of site safety plans and safe work method statements, conducting safety checks, issuing safety instructions and ensuring those instructions were carried out, preparing monthly safety reports for the project manager and the area "OHS manager", and conducting tool box talks. 35 Mr Traini was engaged as foreman with specific safety duties which included the implementation of site safety plans, daily site safety inspections, site safety inductions and site specific inductions. Mr Sacco held monthly meetings with Mr Traini to discuss both construction and safety issues. Mr McGeoch was contacted for advice about any safety issues raised during those meetings. Mr Sacco and Mr Traini were jointly responsible for obtaining safe work statements from subcontractors before they commenced work on the site. Both Kaydee and SMC provided statements. Kaydee's statement failed to refer to the risks associated with the operation of boom lifts under overhead structures. SMC's statement, did not identify any safety risks or control measures for the use of the boom lift at the site. Mr Sacco accepted, without confirmation, that Mr Cunningham was suitably qualified to supervise trainees in the use of the boom lift; and, that Mr Freeland was appropriately qualified. Mr Sacco conceded in his affidavit that he was wrong to accept information (from an undisclosed source) that Mr Freeland would act as site supervisor in Mr Cunningham's absence. 36 Mr Gallace participated in a site specific induction undertaken by Sacco on 11 May 2005. Sometime on or before 27 May 2005, Mr McGeoch observed workers operating the boom lift at height who were not wearing safety harnesses. He confronted those workers and instructed them to wear their harnesses and connect them to the boom lift's EWP. On the day of the accident Mr Traini while conducting site rounds noticed that Mr Gallace's harness lanyard was not connected to its anchor point. He took immediate action to address the matter. 37 Kaydee contracted with SMC to erect the structural steel beams. As part of the contract, SMC was to provide all aspects of supervision, equipment and labour requirements in order to meet occupational health and safety obligations. (I interpolate here that a defendant cannot "contract out" of its occupational health and safety obligations under the Act. Those statutory obligations exist over and above, and entirely separate from, any contractual provisions to the contrary.) 38 Mr Beddow, Kaydee's manager at the site, prepared a safe work method statement prior to commencing work at the site. According to Mr Haddad, Kaydee's director, Mr Cunningham was inducted into the safe work method statement. SMC was required to fill out a site hazard and risk assessment according to Mr Haddad, but no such document was produced by Kaydee during the sentence proceedings. Mr Cunningham had meetings with Mr Haddad and Mr Beddow about two to three times a week during which safety issues such as wearing harnesses and hard hats were discussed. Mr Haddad visited the site about twice a week. Mr Beddow also visited the site. Kaydee developed a safety manual sometime in July 2003. Kaydee conducted detailed inspections and checks on a monthly basis. A suggestion box was made available so that staff could alert Kaydee to various issues. Kaydee also kept a register of injuries book. Equipment was regularly maintained, electrical testing and tagging of equipment was carried out, and a register kept of electrical equipment. Kaydee also conducted "on the job" training for employees with regard to manual handling procedures, noise and hearing protection and fire extinguisher use. First aid kits were regularly maintained and fire hose reels and fire extinguishers checked every six months. 39 Mr Cunningham in his affidavit sought to emphasise that he took the safety of employees seriously. He said he employed Mr Freeland to act as site foreman on behalf of SMC, and to be responsible for occupational health and safety issues, including training and supervision. He said that Mr Freeland was the person responsible for Mr Gallace's training and supervision. He requested, on a number of occasions from Mr Freeland, proof of his certificate of competency. He said that Mr Freeland advised him that he may have lost it. He also conceded that Mr Gallace was unsupervised at the time of his accident but added that he, "would have been supervised by either [Mr Freeland] or myself ninety nine per cent of the time." 40 In relation to ensuring safety at the site, Mr Cunningham said that he held regular meetings with SMC employees during which safety issues were discussed. He frequently raised the requirement to wear a safe harness and hard hat when operating a boom lift, with those employees. On the morning of the accident, he recalled Mr Traini informing him that Mr Gallace's safety harness was not attached while he was operating the boom lift. Mr Cunningham immediately summonsed Mr Gallace, and other SMC employees, and instructed them to wear their safety harnesses and connect them properly to the boom lift. 41 This material suggests that the three defendants had reasonably comprehensive systems in place before 3 June 2005, which sought to reflect matters of occupational health and safety. Although the systems all suffered from certain deficiencies, in particular with regard to the identification of risks, training, instruction and supervision associated with the operation of the boom lift, the systems nevertheless indicate that the defendants endeavoured to take their occupational health and safety obligations seriously. These matters are deserving of some mitigation of the otherwise objective seriousness of the offences. Respective culpabilities 42 It was submitted on behalf of Sacco that an assessment of its culpability, by reference to the other defendants, should take into account that the direct responsibility for the supervision of Mr Gallace as a trainee fell upon SMC. None of Sacco's employees were qualified as "responsible persons" in the instruction of a trainee in the operation of the boom lift. Sacco also pointed to the mechanical failure of the boom lift as a contributing failure to the incident. 43 In my view the fact that Mr Gallace's employer (and Mr Cunningham) had supervisory responsibilities for Mr Gallace in relation to the operation of the boom, does not discharge Sacco from its obligations to provide necessary supervision to Mr Gallace or to ensure that necessary supervision was provided by someone else. If direct supervision were not possible, because of, for example, lack of appropriate expertise or qualifications, it was incumbent upon Sacco to ensure that some other suitably qualified person or persons could carry out appropriate safety instruction and supervision as directed by it: Inspector Aldred v Herbert and others [2007] NSWIRComm 170 at [29]. An employee cannot discharge its statutory duties through delegation of safety matters to another supervisor, or manager: WorkCover Authority of New South Wales (Inspector Patton) v Fletcher Constructions Australia Ltd (2002) 123 IR 121. 44 According to the agreed statement of facts there were no documented safe work methods for the operation of the boom lift, or EWP, between the various employers at the site. Nor did Sacco require workers on site to produce relevant certification before allowing them to operate the boom lift (and other machinery) at the site. Sacco was the project manager at the site with attendant safety responsibilities in relation to the whole of the site, and towards all persons on the site. 45 As to the mechanical fault detected in the operation of the boom lift, Sacco's reliance on this as a contributing factor is misplaced. This is because Sacco sought to connect the defect to the cause of the accident. The offences with which each defendant was charged are concerned with breaches of the Act and resultant risks to safety, that is, a risk of injury, for example, and not an actual injury, or an accident. In any event the conclusion in the expert's report, in relation to the cause of the accident, was speculative as to that cause. Whether the defect, which prevented the EWP from changing to low speed mode, was manifest at the precise time of the accident, was placed no higher than a possibility in the report. 46 On behalf of Kaydee it was submitted that its culpability was substantially lower than that of the other defendants. The basis upon which this submission was made appears to be that Kaydee's culpability occupied fewer paragraphs in the agreed statement of facts compared to the other defendants. Kaydee submitted that the risk arose because of the failure of supervising staff at SMC to properly train and supervise. 47 I have already dealt with the submission made on behalf of Sacco which purports to deflect responsibility for statutory obligations as to safety to another party by reason of that party's responsibilities of direct supervision. My conclusions in relation to that submission apply with equal force to Kaydee. A defendant cannot delegate its statutory obligations to ensure safety to another person. Kaydee's responsibilities extended to those workers employed by SMC, including Mr Gallace. Kaydee subcontracted SMC to perform the work which involved the erection of the structural steel beams and the operation of the boom lift. Its obligations extended to ensuring that SMC employees were suitably qualified and capable of undertaking the work safely. This was not a case of neglect of safety measures on the part of Mr Gallace in circumstances where otherwise safe systems of work had been promulgated and Mr Gallace had been properly trained and instructed in relation to those systems. Mr Gallace was neither properly trained, instructed nor supervised in, or during, the operation of the boom lift. These failures reflect on Kaydee as much as on SMC, and Sacco. 48 SMC was Mr Gallace's employer. Mr Cunningham, as the "responsible person" for ensuring Mr Gallace could safely operate the boom lift, failed to discharge his responsibilities. He has conceded that his record keeping and paperwork and his system of supervision were deficient. Mr Cunningham did not ensure that Mr Freeland was properly certified in the use and operation of the boom lift. Nor did he ensure that Mr Freeland had provided instructions to Mr Gallace on the operation of the boom lift. These matters have been addressed in some detail earlier in these sentencing reasons and need not be repeated here. 49 The prosecutor submitted that the respective culpabilities of the three defendants "were probably" equal. In all the circumstances I agree. Each defendant had some direct involvement in the construction work and had statutory obligations to ensure the safety of workers at the site. Each defendant failed to ensure that safe work methods were designed and implemented with regard to the work being undertaken by Mr Gallace at the time of his accident. Pleas of guilty 50 The defendants entered pleas of guilty at the earliest, or first reasonable opportunity. I propose in these circumstances to assess an appropriate discount of penalty for the utilitarian value of the pleas of guilty at 25 per cent. 51 As a separate consideration from the utilitarian value of the plea the defendants are also entitled to leniency in recognition of the remorse shown by the pleas of guilty. The absence of prior convictions also entitles each defendant to leniency normally extended to an offender who is otherwise not adversely recorded. 52 In the absence of prior convictions, the corporate defendants, Sacco and Kaydee, each face a maximum penalty of $550,000. Mr Cunningham faces a maximum penalty of $55,000. 53 Both Kaydee and Mr Cunningham submitted that the Court could exercise its discretion under s 10 of the Crimes (Sentencing Procedure) Act 1999 (CSPA). On behalf of Kaydee it was submitted that such an order could be made in conjunction with a bond to be of good behaviour. On behalf of Mr Cunningham it was submitted that the Court should consider exercising its discretion under s 10 of the CSPA. No basis was put forward to advance the submissions. 54 It was conceded on behalf of Kaydee in oral submissions that an order under s 10 of the CSPA is only made in rare and exceptional circumstances: see for example WorkCover Authority of New South Wales (Inspector Downie) v Menzies Property Services Pty Ltd (2004) 136 IR 449 at [45] to [50]. In my view the circumstances which gave rise to the offences are such that it would be an inappropriate exercise of the Court's discretion to grant the applications. No matters have been advanced by either defendant which might attract the exercise of the Court's discretion in order to grant the applications. The finding that the offences are objectively serious, of itself, would normally preclude the applications being granted: Downie v Menzies at [55]. 55 I also take into account in Kaydee's favour its evidence of good corporate citizenship, its cooperation with WorkCover, its contrition expressed on its behalf in written submissions, and its assistance by way of a payment of $8,000 to Mr Gallace's family, for a remembrance plaque. 56 I also take into account in further mitigation of the penalty to be imposed against Kaydee, the measures it has developed and implemented following the commission of the offence. These have been set out in Mr Haddad's affidavit. They include, further development of the company's OH&S systems and the upgrading and development of procedures in relation to steel erection. A company has been retained to conduct an annual external audit of the OH&S systems. Kaydee has also employed a person to oversee the maintenance of its OH&S procedures. It is also developing an OH&S management system which is consistent with the NSW Construction Agency Management Plan, edition 4 guidelines. A review is also in the process of being undertaken of Kaydee's factory at Toongabbie, to ensure the safety of all personnel at the site. Kaydee also conducts random checks and site visits. Weekly tool box meetings are now held at work sites. Prior to the commencement of a project at a particular site, Kaydee checks by way of a questionnaire, that employees are licensed and that they carry out job safety analysis and plant inspection requirements. An OH&S Committee meets monthly to report on safety issues. Mr Haddad is currently involved in a WorkCover accredited OH&S consultation training course. Kaydee now endeavours at all sites to strictly enforce its safety policies and procedures. In addition, safety procedures are being continually updated to ensure that safety standards are effective in minimising workplace incidents. 57 I also take into account in Sacco's favour, its expression of remorse by reason of its expressed acceptance of responsibility for its involvement in the offence. In addition I take into account its cooperation with WorkCover, its assistance provided to Mr Gallace's family by way of a donation of $12,000 towards funeral expenses, and its good community standing. 58 Sacco has also implemented a number of post-offence remedial measures aimed at improving safety at the work site, which operates in mitigation of penalty. These measures include the inspection and logging into a plant register of all items and plant and equipment upon arrival at a work site, and enforcement of a requirement that all personnel produce certificates of competency. Tickets are also checked, verified, photocopied and recorded in the plant register. Log books are inspected daily after "sign off". A plant risk assessment checklist has been included in the site safety plan, which is used to review all safe work method statements. Subcontractors are required to complete the plant risk assessment check list. All workers are inducted into the safe work method statements, site specific inductions now include a discussion of risks, and the site safety plan contains a requirement, as part of the site specific inductions, that trainees, and "responsible persons" be identified. Supervisors' qualifications are verified and trainee log books inspected. The site specific induction also incorporates a "three warning system" and breach notices for any worker who fails to comply with Sacco's OH&S requirements. 59 A submission was made on behalf of Mr Cunningham, that the Court, when considering penalty, should take into account in Mr Cunningham's favour the fact that Mr Cunningham has already been "punished severely" as a result of Mr Gallace's accident. A report by Dr Julian Parmegiani, general and forensic psychiatrist, was annexed to Mr Cunningham's affidavit. The report addresses Mr Cunningham's past psychiatric history prior to the offence. The history includes episodes of depression and excessive alcohol consumption. According to the report, Mr Cunningham's anxiety escalated after Mr Gallace's fatal accident. He experienced nightmares and a deterioration of sleep patterns. He became extremely depressed, resumed his excessive alcohol consumption, at times became suicidal, and subsequently lost his business in 2007. In October 2006 he ceased his consumption of alcohol. He continues to experience periods of depression, memories of the accident remain constantly with him and he has been unable to continue to work in the construction industry. 60 The Court was not directed to any authorities in support of the submission. I dealt with a similar submission, and its relevance to mitigation of penalty in Inspector Stephen Cooper v Franklin Alden Coveney and Another [2008] NSWIRComm 80. In that judgment I considered some authorities which were relied upon in support of the submission. For convenience, the relevant passages from the judgment which deal with those authorities are extracted below: [34] A submission was also made on behalf of the defendants that the devastating effect on their business in the aftermath of the accident entitles them to further mitigation of the penalties. The Court's attention was directed to two authorities. In the first of these, WorkCover Authority of New South Wales (Inspector Farrell) v Morrison (No 2) (2002) 112 IR 312 his Honour, Justice Walton , Vice-President, made the following remarks: [68] Contrition, repentance and remorse after an offence are mitigating factors which may lead to a reduction in the sentence otherwise to be imposed: A M Hoipo & Sons Pty Ltd (at par 64); Corinthian Industries (Sydney) Pty Ltd v WorkCover Authority (NSW) (Inspector Wilson) (2000) 99 IR 159 at par 17). I consider that the defendant is contrite and has demonstrated a high level of remorse. I have also had regard to the significantly adverse changed personal, business and professional circumstances of the defendant which arose as an aftermath of the incident: see Berrima (at par 201). It is appropriate to take account of the defendant having assisted the prosecutor with its investigations. Further, I consider, on the evidence of the defendant, noting that there was no demur on behalf of the prosecutor, the defendant has otherwise operated as a good industrial citizen for a period of some 20 years without prosecution having been brought against him. [35] Justice Walton's findings, expressed in the passage above made reference to Department of Mineral Resources (Chief Inspector McKensey) v Berrima Coal Pty Ltd and Another (2001) 105 IR 348. In that Judgment his Honour said: [201] I have had the opportunity of observing the second defendant giving evidence in these proceedings. He was genuinely contrite. He has suffered remorse, shock and distress over the incident. Four days after the incident he started to develop chest pains and ultimately suffered a heart attack. In my view, this had a direct connection to the death of Mr Fraser. The second defendant did not return to work for two months, yet continues to suffer, in my view, at a personal and psychological level as a result of the incident. [36] In the second authority relied upon, WorkCover Authority of New South Wales v Hitchcock (2005) 139 IR 439, Justice Walton made the following comments: [39] I accept Mr Moses's submissions from the bar table (which were not objected to by the prosecutor) to the effect that Mr Hitchcock was contrite for Mr Haynes's tragic death. However, I agree with the prosecutor that such an expression of contrition must be assessed in the light of Mr Hitchcock's conduct following the accident, which does not entirely sit comfortably with significant feelings of contrition or remorse. In particular, I repeat my earlier finding that there were no effective changes to the Company's practices or procedures, despite the fatal accident and despite the availability of simple and obvious remedial measures. [40] I also accept Mr Skinner's submission that the tenor of Mr Hitchcock's affidavit (replete with phrases such as "I always tried to run a professional law-abiding business"; "... it was my practice to inform drivers to stop and rest"; and "I have continued to reinforce to drivers the importance of managing fatigue"); suggests an impediment to full recognition of culpability. It is difficult, in these circumstances, to find any acknowledgment by Mr Hitchcock of having committed a wrong (without which there can be no remorse), let alone detect any serious purpose to amend his wrongdoing. Mr Hitchcock undoubtedly recognises that a tragedy has befallen Mr Haynes and Ms Campbell; that he and his business have suffered significant adverse consequences as a result; and he is undoubtedly sorry that this suffering has occurred. However, even with the eloquence of Mr Moses's submissions to enhance this aspect of Mr Hitchcock's contrition on sentence, there is a degree of reluctance in the contrition offered. [37] It seems reasonably clear from the passages extracted above that the context in which his Honour Justice Walton considered the relevance of any adverse impact on a defendant in the aftermath of a workplace accident was whether the defendant should benefit on penalty by reason of having shown contrition. 61 Similarly, in my view, the submission made on behalf of Mr Cunningham in these sentence proceedings, and its relevance to the impact of Mr Gallace's accident on Mr Cunningham, may be considered in the context of contrition expressed by him in the aftermath of the accident. I propose therefore to take it into account on that basis in my assessment of the penalty to be imposed on Mr Cunningham. 62 It was also requested on behalf of Mr Cunningham that the Court take into account on penalty, his capacity to pay a fine. It was contended that Mr Cunningham has suffered financially following the offence. Mr Cunningham in his affidavit stated that he earned approximately $836 a week and had weekly expenses of about $950. No documentation in the form of financial records was annexed to the affidavit. The Court was informed during oral submissions that Mr Cunningham was "between jobs" at the time of the sentencing hearings but expected to obtain employment on a wage similar to his weekly income set out in his affidavit. 63 In view of the paucity of material with which the Court was presented, in relation to Mr Cunningham's financial circumstances, the Court regards the material as insufficient for the purpose of properly considering Mr Cunningham's capacity to pay a fine under s 6 of the Fines Act 1996. Victim impact statements 64 During the sentence proceedings, the prosecutor tendered two statements from Mr Gallace's parents. Those statements attest to the devastating impact the death of their son has had on the family. Mr Gallace was their only son and was only 24 years of age at the time of his death. The Court extends its deepest sympathies to Mr and Mrs Gallace and their daughter, and sincerely hopes that the passage of time will ease some of their pain and suffering. Penalty 65 In determining penalties against the defendants I have taken into account the objective seriousness of the offences, the maximum penalties, the factors in mitigation described above, the absence of prior convictions and the respective culpabilities of the defendants. These factors have been considered by reference to the CSPA, in particular s 21A. Orders 66 In Matter No IRC 929 of 2007, I make the following orders: (i) the defendant Sacco Builders Pty Ltd is convicted of the offence; (ii) the defendant is fined $180,000 with a moiety to the prosecutor ; (iii) the defendant is to pay the costs of the prosecutor as agreed, or in the absence of agreement, as assessed. 67 In Matter No IRC 931 of 2007, I make the following orders: (i) the defendant Kaydee Engineering Pty Ltd is convicted of the offence; (ii) the defendant is fined $180,000 with a moiety to the prosecutor ; (iii) the defendant is to pay the costs of the prosecutor as agreed, or in the absence of agreement, as assessed. 68 In Matter No IRC 934 of 2007, I make the following orders: (i) the defendant James Wilfred Cunningham is convicted of the offence; (ii) the defendant is fined $18,000 with a moiety to the prosecutor ; (iii) the defendant is to pay the costs of the prosecutor as agreed, or in the absence of agreement, as assessed. _______________ AMENDMENTS HISTORY: 22/09/2008 - Add "with a moiety to the prosecutor " - Paragraph(s) 66(ii), 67(ii) and 68(ii) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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