Industrial Court of New South Wales CITATION: WorkCover Authority of New South Wales (Inspector Littley) v George Chrisohoidis trading as Express Tyres and Suttons Motors Arncliffe Pty Ltd [2006] NSWIRComm 162 PROSECUTOR: WorkCover Authority of New South Wales (Inspector Littley) PARTIES: DEFENDANTS: George Chrisohoidis t/as Express Tyres Suttons Motors Arncliffe Pty Ltd FILE NUMBER(S): IRC 4599; IRC 4600 of 2005 CORAM: Staunton J CATCHWORDS: Occupational health and safety - pleas of guilty - general principles - foreseeability - objective seriousness of the offences - relative culpability of defendants - general and specific deterrence - defendants have no prior convictions - subjective features taken into consideration - penalties imposed - orders as to penalty, moiety and costs. Crimes (Sentencing Procedure) Act 1999 LEGISLATION CITED: Fines Act 1996 Occupational Health and Safety Act 2000 Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 Ferguson v Nelmac Pty Limited (1999) 92 IR 188 Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 Markarian v The Queen [2005] HCA 25: 18 May 2005 CASES CITED: R v Gallagher (1991) 23 NSWLR 220 R v Thomson; R v Houlton (2000) 49 NSWLR 383 R v Way [2004] NSWCCA 131 Thorneloe v Filipowski (2001) 52 NSWLR 60 WorkCover Authority of New South Wales (Inspector Mansell) v Jian Chen and Obing Pty Limited trading as Old But New [2004] NSWIRComm 247 HEARING DATES: 13/6/2006 DATE OF JUDGMENT: 06/20/2006 PROSECUTION: Ms P Lowson of counsel SOLICITORS: Criminal Law Pratice Legal Group FIRST DEFENDANT: LEGAL REPRESENTATIVES: Mr A Hallas of counsel SOLICITORS: Johnsons Solicitors SECOND DEFENDANT: Mr R Crow of counsel SOLICITORS: Workplace Law JUDGMENT: INDUSTRIAL RELATIONS COURT OF NEW SOUTH WALES CORAM: Staunton J DATE: 20/6/2005 Matter No IRC 4599 of 2005 WorkCover Authority of New South Wales (Inspector Littley) v George Chrisohoidis t/as Express Tyres Prosecution pursuant to section 8(2) of the Occupational Health and Safety Act 2000 Matter No IRC 4600 of 2005 WorkCover Authority of New South Wales (Inspector Littley) v Suttons Motors Arncliffe Pty Ltd Prosecution pursuant to section 8(2) of the Occupational Health and Safety Act 2000 JUDGMENT [2006] NSWIRComm 162 1 The first defendant in this matter, George Chrisohoidis, runs a tyre fitting business, which trades under the name of Express Tyres. In that capacity, Mr Chrisohoidis has entered a plea of guilty to an offence arising under s 8(2) of the Occupational Health and Safety Act 2000 (the Act). The second defendant, Suttons Motors Arncliffe Pty Limited (Suttons), has also entered a plea of guilty to an offence in similar terms arising under s 8(2) of the Act. The offence in respect of both defendants arises from the same factual circumstances. 2 In relation to Mr Chrisohoidis, it was said that the defendant: Failed to ensure that persons other than the defendant's employees and, in particular, Robert Edward McPhillips, were not exposed to risks to their health or safety arising from the conduct of the defendant's undertaking while they were at the defendant's place of work. 3 The particulars of the charge in relation to Mr Chrisohoidis are: [1] The defendant failed to provide adequate supervision to non-employees working under his direction. [2] The defendant failed to provide adequate information, instruction and training to non employees working under his direction. [3] The defendant failed to devise, provide or maintain an adequate system of work that would prevent non employees being exposed to the risk of injury as a result of tyre fitting activities carried out at his direction. [4] The defendant failed to undertake an adequate risk assessment so as to identify and guard against the risk of injury to non employees undertaking tyre fitting activities at his direction. As a result of the defendant's failures, Robert Edward McPhillips was placed at risk of injury. 4 With the exception of the obvious formalities, the offence and particulars charged with respect to Suttons Motors is in the exact same terms as the charge against Mr Chrisohoidis set out above. 5 The prosecution has tendered an agreed statement of facts in both matters. In relation to Mr Chrisohoidis, the agreed facts are as follows: [1] At all material times, George Chrisohoidis of 77 Valentia Avenue, Lugarno in the State of New South Wales ("the defendant") was self employed and operated a mobile tyre fitting service business that traded as Express Tyres [ABN:58049873675]. [2] At all material times the defendant was an employer. [3] At all material times Suttons Motors Arncliffe Pty Ltd ("Suttons Motors") was a corporation which undertook the business of sales, service and repairs of motor vehicles and trucks, including spare parts sales, delivery and panel beating. [4] At all material times Suttons Motors operated a vehicle sales yard and service centre at 93 Princes Highway, Arncliffe, New South Wales ("the premises"). [5] Suttons Motors engaged the defendant to provide tyre fitting services at the premises, for which the Suttons Motors paid the defendant. The defendant performed tyre fitting services at the Suttons Motors' premises approximately two to three times per week. [6] There was no written contract between Suttons Motors and the defendant, however it was the usual practice that, where a tyre needed to be replaced, the defendant would provide the replacement tyre. [7] At all material times Robert Edward McPhillips, ("McPhillips") was carrying out work and providing assistance to the defendant in his tyre fitting business. McPhillips was 63 years of age at the time of incident. He was retired from his usual occupation as a storeman. [8] There was no contractual or employment arrangement between the defendant and McPhillips. McPhillips was not remunerated for the services he provided but rather was assisting the defendant to provide him with company and to get himself out of the house. Mc Phillips had little practical experience in tyre fitting activities other than from observing the defendant performing tyre-fitting tasks. McPhillips advised his duties with the defendant usually consisted of handing him tools and equipment and on occasion inflating tyres. He regularly attended clients' sites with the defendant and had accompanied the defendant to the premises on many occasions prior to the incident on 21 October 2003. [9] On 21 October 2003 the defendant was requested by William Nicolopoulos ("Nicolopoulos"), a Motor Mechanic employed by Suttons Motors to undertake a tyre fitting job. Nicolopoulos telephoned the defendant and advised that a vehicle needed a new tyre fitted and requested the defendant attend the premises to undertake the job. Nicolopoulos gave the defendant details of the type of vehicle and advised it was in the workshop. The defendant advised Nicolopoulos he would send McPhillips over. The defendant then arranged with McPhillips to attend at the premises and commence replacing the tyre. The defendant supplied the tools for McPhillips to do the work of changing the tyre. [10] Shortly after 1pm on 21 October 2003 Patrick Schinella, Suttons Motors truck service manager, was in Suttons Motors truck bay workshop inspecting a gear box with an Isuzu representative when they heard a loud bang. Suttons Motors truck bay workshop has five service bays. They went to where the noise came from and found McPhillips laying face down and unconscious. They arranged for an ambulance to be called and for the defendant to be advised of the incident. They waited with McPhillips until the ambulance arrived. [11] McPhillips has no recollection of the incident on 21 October 2003 or his attendance at the site. No witnesses to the incident have been identified. No employees of Suttons Motors interviewed as part of the WorkCover investigation into this incident saw McPhillips on site prior to the incident occurring. [12] The defendant's mobile tyre truck was parked in front of the bay in which McPhillips was found. The tyre truck had a large cage on the back which was filled with tyres, including an 8.25 by 15 inch tyre. The bay had large bi-fold metal panel doors which were in the raised position at the time of the incident. [13] McPhillips was found inside the bay next to a truck trailer from which a tyre and split rim wheel had been removed. A used 8.25 by 15 inch tyre was on the ground by the truck trailer. Nearby was a new tyre partially fitted to the wheel from the truck trailer. The new tyre was a 8.25 by 16 inch tyre. The inner tube was visible between the tyre and wheel rim and was split. Various tools were observed. There were tyre and wheel impact impressions on the concrete floor of the bay around where the new tyre and wheel were located and black marks on the raised bi fold panel metal door directly above (6 metres from the ground) the location where the tyre and wheel were found. A pneumatic pressure air hose inflator and gauge were nearby. [14] It appears that McPhillips had been attempting to fit an 8.25 by 16 inch tyre to a wheel with a 15 inch rim and that when the inner tube of the tyre was being inflated it squeezed out between the tyre and rim and subsequently exploded, causing the wheel to project upwards and strike him in the upper body, limbs and head. [15] As a result of the incident on 21 October 2003 McPhillips sustained brain injury, 3 cracks in the neck, two right wrist fractures, a broken right arm, and nerve damage to the right arm. He required complete face reconstruction and operations to his eyes. [16] Subsequent to the incident, at approximately 3.30pm on 21 October 2003, Inspector Grant Vosu of the WorkCover Authority attended Suttons Motors premises and made the observations set out in paragraph 14 above. Inspector Vosu also took a number of photographs and completed a Factual Report of his inspection. The photographs and Factual Inspection are annexed at "a" and "b". [17] Fitting the incorrectly sized tyre to a wheel involves a risk that the tyre inner tube will not inflate correctly and may explode. Truck tyres are larger than car tyres and must be inflated to a greater pressure, increasing the risks associated with the inner tube exploding. [18] At the time of the incident Suttons Motors did not have at their premises a safety cage to restrict the effects of any potential explosion which may occur whilst undertaking tyre fitting activities. [19] McPhillips received no training and no adequate instruction and information in relation to split rim wheel tyre fitting from the defendant. [20] McPhillips was not provided with a safety cage by the defendant to use at the premises. McPhillips was not adequately instructed, informed or trained in the use of safety cages by the defendant. [21] The defendant did not conduct a risk assessment prior to the incident relating to tyre fitting and split rim wheels. [22] Subsequent to the incident occurring the defendant has conducted a risk assessment and purchased a safety cage which he now uses to fit truck tyres. He now only allows himself to change tyres. 6 Formalities aside, the agreed facts filed in relation to Suttons Motors are in the same terms with the addition, relevantly, of the following: [1] At the time of the incident the defendant did not have at its premises a safety cage to restrict the effects of any explosion which may occur whilst undertaking tyre fitting activities. [2] The defendant had a safe operating procedure document entitled "Procedure for the Use of Contractors" prior to the incident, which in clause 3 requires the provision of a safety cage by a contractor when changing tyres on split rims. Chrisohoidis had not been provided with a copy of this procedure. [3] The defendant did not provide any or any adequate information, instruction or training to Chrisohoidis or McPhillips, nor did it require Chrisohoidis to ensure that any person performing work on his behalf was adequately informed, instructed or trained, in the work to be performed. [4] The defendant had not: (i) adequately assessed the risk of contractors performing tyre fitting work at the premises; (ii) provided or maintained a system of work that would prevent non-employees being exposed to the risk of injury undertaking tyre fitting work at the premises. [23] Since the incident the defendant has conducted a risk assessment relating to tyre fitting on split rim wheels and has implemented a system whereby all truck tyres are taken off site by contractors for the tyre to be fitted in the contractors' workshop utilising a safety cage. The defendant has also reviewed its contractor policies and procedures and has implemented a "Code of Conduct for Contractors" working at its site which it requires contractors to sign. Annexed hereto and marked with the letter "c" is a copy of the Code of Conduct. 7 In addition to the agreed facts in both matters, the prosecution also tendered a bundle of documents with respect to each matter including: (i) photos 1-28; (ii) a factual inspection report by Inspector Grant Vosu, dated 23 June 2004; (iii) a copy of Suttons Contractor Code of Conduct (relevant to Suttons Motors only); (iv) affidavit of Inspector Robert Littley, sworn 17 March 2006. In his affidavit, Inspector Littley details his investigation into the accident involving Mr Robert McPhillips. The statements taken from relevant employees of Suttons Motors and Mr McPhillips are annexed to his affidavit but are not included here. As well, Inspector Littley relevantly deposed to matters relating to the cause of the accident involving Mr McPhillips as follows: [11] Tyre safety cages are a safety device normally used when inflating split rim truck tyres. The purpose of the safety cage is to confine the tyre and wheel should the tyre explode during inflation. A safety cage should be of a sufficient structural strength to confine the tyre/wheel within the cage. Annexed and marked "H" is a WorkCover Health and Safety Note on Assembling Truck and Tractor Tyres and Rims which includes a diagram of a safety cage. ... [17] Another consequence of a truck tyre inner tube exploding can be to cause the entire wheel to become a projectile. It appears that is what occurred in the present incident. The evidence suggests that: (i) The wheel and tyre were either lying flat on the ground with the connection face up, or vertical with the connection facing towards McPhillips; (ii) the tyre was 1 inch larger than the wheel; (iii) the inner tube squeezed out of the space between the tyre and the wheel as the inner tube was being inflated on the side of the wheel facing away from where McPhillips was inflating the tyre; (iv) the inner tube exploded causing the wheel to be projected in the opposite direction to where the explosion occurred, thus projecting the wheel into McPhillips. 8 On behalf of Mr Chrisohoidis, the following material was tendered: (i) Affidavit of Mr George Chrisohoidis, sworn 15 March 2006. Mr Chrisohoidis runs a tyre fitting service under the trading name "Express Tyres". He has run this business since 1989 and is assisted by his wife in relation to 'the administration and paperwork'. In his affidavit, Mr Chrisohoidis outlined new safety steps implemented since the accident. He also deposed as to his relationship with Mr McPhillips and his contrition for the injuries which befell Mr McPhillips as a result of the accident. (ii) two personal testimonials relating to Mr Chrisohoidis; (iii) four photographs of the rear of Mr Chrisohoidis' truck showing remedial changes made relative to changing tyres. Those remedial changes were accepted by the prosecution as one way in which, as necessary, tyres can be safely changed and inflated. 9 On behalf of Suttons, the following material was tendered: (i) Affidavit of Mr Patrick Schinella, sworn 16 March 2006. Mr Schinella is employed as a Truck Service Manager at Suttons Motors. He has been employed in that position since June 1999. In his affidavit, Mr Schinella outlined his occupational health and safety training and involvement at Suttons Motors. He also deposed as to events at Suttons Motors on the day of the accident involving Mr McPhillips. Mr Schinella also deposed that on some three to four occasions prior to the accident involving Mr McPhillips, he had told Mr Chrisohoidis that he was not permitted to tyre change or undertake the inflating of split rim truck tyres at Suttons worksite. That latter issue is one I will return to in due course later in this judgment. (ii) Affidavit of Mr William Nicolopoulos, sworn 16 March 2006. Mr Nicolopoulos was initially employed at Suttons Motors in 1997 as motor mechanic. He is currently employed as a workshop supervisor. In his affidavit, Mr Nicolopoulos confirmed that he had telephoned Mr Chrisohoidis on the day of the accident and told him that there was 'a rim here with a tyre that needs to be pulled off and repaired'. He stated that he asked Mr Chrisohoidis to 'come over and pick it up'. As workshop supervisor for the defendant, Mr Nicolopoulos deposed as to the steps now in place to check and accredit all contractors who come on site. That system was introduced after the accident involving Mr McPhillips. (iii) Affidavit of Mr Robert Henry Pickett, sworn 16 March 2006. Mr Pickett is employed as the Insurance and Risk Manager for Suttons Motors Management Pty Limited and has been employed in this position for about 10 years. In this role, Mr Pickett is responsible for managing OHS policies and procedures within the Suttons Group of companies. In his affidavit, Mr Pickett outlined the OHS policies of the Suttons Group of companies as well as the ameliorative steps taken by the Suttons Group since the incident involving Mr McPhillips. (iv) Affidavit of Mr Gregory Dennis King, sworn 16 March 2006. Mr King is employed as General Manager of Trucks at Suttons Motors Arncliffe. In this role, Mr King is responsible for overseeing the truck operations of the dealership. In his affidavit, Mr King outlined Suttons Motors Arncliffe's policies for contractors working on site as well as the company's policy regarding tyre changing work. Mr King also deposed to the events on the day of the incident involving Mr McPhillips as well as remedial actions taken by Suttons Motors Arncliffe following the accident. (v) Affidavit of Mr Robin Alan Blackburn, sworn 16 March 2006. Mr Blackburn is employed by the Suttons Group as Finance Director. In his affidavit, Mr Blackburn outlined the structure of the Suttons Group and its interests as well as the group's history and current activities. Mr Blackburn also detailed the Group's OHS procedures. 10 Inspector Littley was the only deponent required for cross examination. 11 Both defendants' prior conviction record is before me. Those records disclose no prior convictions on the part of either defendant. Relevant principles 12 The overall approach to be followed in relation to the determination of penalty is to be found in the first instance within the statutory provisions of the Crimes (Sentencing Procedure) Act 1999 (CSPA) and in particular in relation to these proceedings, ss 3A Purposes of Sentencing, 21A Aggravating, mitigating and other factors in sentencing, 22 Guilty plea to be taken into account. 13 In R v Way [2004] NSWCCA 131 it was emphasised that the provisions of the CSPA referred to above are not to be construed as representing 'a departure from settled principles of sentencing practice, or an abandonment of the discretion that is essential to any system calling for individualised justice'. As was said at [59]: ....it is clear that the legislative policy.......so far as that can be discerned from the legislation itself, was not to create a straight jacket for judges...but rather were intended to provide 'further guidance and structure to judicial discretion.' 14 It is well settled that the starting point for considerations as to penalty is the objective seriousness of the offence charged: Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 464 at 474. 15 The principle of foreseeability as a factor in determining the objective seriousness of an offence was considered and affirmed in the Full Bench decision of Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 at 646. 16 On the issue of foreseeability, the Full Bench in Capral also stated: The existence of a reasonably foreseeable risk of injury will necessarily result in the offence being more serious in nature. However, the absence of foreseeability does not necessarily render the offence as being nominal or not serious. In this regard the relevant approach is that set out in the judgment of Wright J, President, in Ferguson v Nelmac Pty Ltd (at 209-210) in these terms: ... reliance on 'hindsight' must be seen in an appropriate perspective in terms of culpability. It is a relevant consideration but the very terms of s 15 impose an obligation on an employer which is not confined to the taking of precautions only when there are warnings or signals of danger or when experience indicates that a risk to safety has arisen and requires remedy. 17 The principles of general and specific deterrence are also relevant in sentencing considerations. The approach to be taken on that issue has also been dealt with in some detail in Capral at 643-645. Without detailing all that the Full Bench had to say on those issues I believe the approach to deterrence in the sentencing process is encapsulated in the following passage from the Full Bench in Capral at 644 as follows: ... both aspects of deterrence are matters which should normally be given weight of some substance in the sentencing process; and although there may be exceptional cases (see, for example, Page v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39 at [40]-[43] we would expect such cases to be very rare, and where the relevant circumstances were held by the sentencing judge to be established, the judge must indicate with some precision the circumstances which had led to the exceptional course being adopted. 18 In the context of the above well established sentencing principles it will also be necessary to have regard to those general matters going to aggravation, mitigation and other factors identified in s 21A (1) of the CSPA relevant to the defendant. As was said in R v Way at [56]: ... it is not to be overlooked that there is a well established body of principles that have been developed by the courts over a long period of time. By providing guidance in the form of a list of aggravating and mitigating factors in s 21A, the Parliament did not intend to overrule or disturb those principles or restrict their application. In so far as those principles refer to factors, whether objective or subjective, that affect the 'relative seriousness' of the offence, they are expressly preserved by s 21A(1)(c). 19 Ultimately, all of the above factors must be considered as part of 'a complex of inter-related considerations' (See R v Gallagher (1991) 23 NSWLR 220). Having said that, as was said by Spigelman CJ in Thorneloe v Filipowski (2001) 52 NSWLR 60 at 69, it still remains for the sentencing judge to ensure: ... that a sentence should be proportionate to the objective gravity of the offence. This necessarily requires a sentencing judge to consider, at some stage in the reasoning process, the sentence that is appropriate for the particular circumstances of the crime without reference to the subjective case of the particular offender. 20 In Markarian v The Queen [2005] HCA 25: 18 May 2005, the High Court, by majority (Kirby J dissenting) generally disavowed the sequential or two tiered approach to sentencing. In doing so, their Honours did not entirely reject the proposition that, in some circumstances, 'an arithmetical process' would be appropriate. As they said at [39]: Following the decision of this Court in Wong it cannot now be doubted that sentencing courts may not add and subtract item by item from some apparently subliminally derived figure, passages of time in order to fix the time which an offender must serve in prison. That is not to say that in a simple case, ... indulgence in arithmetical deduction by the sentencing judges should be absolutely forbidden. ... The law strongly favours transparency. Accessible reasoning is necessary in the interests of victims, of the parties, appeal courts, and the public. There may be occasions when some indulgence in an arithmetical process will better serve these ends . ... (emphasis added) 21 On that point, McHugh J also acknowledged the need, where appropriate, for the awarding of a nominated discount for 'some factor'. As he said at [74]: ... The distinction between permissible and impermissible quantification of "discounts" on a sentence will usually be found in whether the quantification relates to a sentencing purpose rather than some other purpose. So, the quantification of the discount commonly applied for an early plea of guilty or assistance to authorities is offered as an incentive for specific outcomes in the administration of criminal justice and is not related to sentencing purposes. The non-sentencing purpose of the discount for an early guilty plea or assistance is demonstrated by the fact that offenders are ordinarily entitled to additional mitigation for any remorse or contrition demonstrated with the plea or assistance, aside from the discount for willingness to facilitate the course of justice... 22 Overall, I observe nothing in Markarian that precludes me, properly in my view, from identifying a discount for the entry of an early plea of guilty. Additionally, to the extent that there are subjective and mitigating features relevant to the defendant, they are matters which also should be considered in accordance with the provisions of the Crimes (Sentencing Procedure) Act 1999, in particular s 21A(1) earlier referred to. Considerations 23 As an individual with no prior convictions, the maximum penalty which can be imposed upon Mr Chrisohoidis is $55,000. As a corporation with no prior convictions, the maximum penalty which can be imposed upon Suttons Motors is $550,000. 24 As the agreed facts disclosed, Mr Chrisohoidis operates a business which trades under the name "Express Tyres". He was and, as I understand, still is, assisted in his work from time to time by Mr Robert McPhillips. Mr McPhillips is retired and is a friend of Mr Chrisohoidis. It would seem that Mr McPhillips has developed a pattern of accompanying Mr Chrisohoidis to his various jobs to keep him (Mr Chrisohoidis) company and to get himself out of the house. He is not an employee and he is not under a contractual obligation to assist Mr Chrisohoidis nor is he remunerated for any work he does to assist Mr Chrisohoidis. 25 Mr McPhillips was not formally trained in the job of tyre fitting. That task was primarily undertaken by Mr Chrisohoidis. Mr McPhillips' tasks were limited to assisting with tools, picking up or making deliveries and occasionally inflating car tyres. As Mr McPhillips deposed in an interview with Inspector Littley, his experience with changing and fitting tyres, particularly split rim tyres, was limited to observing Mr Chrisohoidis undertake such work. 26 It is abundantly clear that the task of fitting truck tyres is not without risk. Car tyres are inflated between 30 – 35 psi (pounds per square inch), compared with 70 – 80 psi for a truck tyre. Higher levels of inflation increase the risk of anything going wrong during the tyre inflation process. Trucks are also typically fitted with a type of wheel known as a split rim wheel. As deposed by Inspector Littley in his affidavit, split rim wheels consist of two or more components held together with locking devices like bolts, locking rings and beads and other fastenings. Problems with split rim wheels typically arise when the tyre is being inflated. If the tyre or inner tube is damaged and explodes, pressure can be placed on the fastenings to cause them to fail and the fastening components to detach from the wheel with enough force to injure or kill a person. 27 A proper safety cage with the capacity to contain the tyre in the event of the tyre "blowing off" due to faulty fastenings should have been used in undertaking the work done by Mr McPhillips. The prosecutor has put before me a WorkCover document titled "Assembling Truck and Tractor Tyres and Rims" which sets out the necessity of such a cage in order to prevent injury when fitting or assembling truck tyres. Suttons certainly knew of the need to undertake such a task using a safety cage. For example, prior to Mr McPhillips' accident, their written Site Operating Procedure for the Use of Contractors stated, inter alia, 1. In the conduct of Suttons normal business it is sometimes necessary to have contractors working on site. It is imperative that contractors employees follow the site rules to ensure business is not interrupted, they and others are not injured and that they work in compliance with laws and regulations. … 3. The contractor will identify any hazards associated with the work to be undertaken and conduct the work to minimise any risk to health, safety and environment or property ( eg: Provision of safety cage when changing tyres on split rims). (emphasis added) 28 In his affidavit on behalf of Suttons, Mr Schinella deposed that he had told Mr Chrisohoidis on a number of occasions prior to Mr McPhillips' accident that he was not to change split rim tyres on Suttons' premises. While such an assertion was not challenged by the prosecution, I have difficulty in accepting that such a view as being the policy of Suttons had been conveyed to Mr Chrisohoidis in such unequivocal terms. The policy of Suttons both before and after the accident was essentially the same although more explicitly expressed after Mr McPhillips' accident, that being: It is a condition of our agreement that no replacement tyres are to be fitted to rims on site unless you provide and use an approved safety cage in your mobile unit. 29 Mr Chrisohoids had a cage at the back of his utility truck but it was not a safety cage as envisaged for the type of work being undertaken by Mr McPhillips. Although it had mesh guards on both sides of the cage, it did not have a mesh cover on top of the cage to contain tyres which could potentially become airborne. Upon observing the cage post-accident, Inspector Littley was of the opinion that the cage was deficient. He stated: … I am of the opinion that the cage on the back of the Express Tyre utility would not be practical to be used as a safety cage. It has no roof/overhead construction and it would not confine a tyre/wheel/rim in the upward motion should the tyre explode. The size of the mesh of the cage may not be of a size that would allow access by the tyre fitter to effectively use the equipment required to inflate the tyre. The vehicle cage also appears not to have significant sideward structural strength to confine an exploding tyre within the cage…" 30 It appears that the direct cause of the accident arose when Mr McPhillips attempted to fit a 16 inch tyre to a wheel with a 15 inch rim. As the inner tube of the tyre was being inflated, it squeezed out between the tyre and rim and exploded, propelling the wheel upwards and striking Mr McPhillips in his head, upper body and limbs. 31 On behalf of Suttons it was submitted that the cause of the injury to Mr McPhillips was the fitting of a tyre that was a size too large and that the injury was 'a likely, if not certain, consequence regardless of the type of rim to which the tyre was fitted'. That is not a submission I embrace without question. 32 There is no doubt the fitting of the wrong size tyre caused the inner tube to explode. However, if Suttons' operating procedure for the task had been enforced, that is, the provision of a safety cage when changing tyres on split rims, the injury would not have occurred at all even allowing for the incorrect size tyre. As Inspector Littley stated: [19] Fitting the incorrectly sized tyre to a split rim wheel involves a risk that the tyre inner tube will not inflate correctly and may explode. Truck tyres are larger than car tyres and must be inflated to a greater pressure, increasing the risks associated with the inner tube exploding. [20] At the time of the incident the defendant did not have at its premises a safety cage to restrict the effects of any explosion which may occur whilst undertaking tyre fitting activities. [21] The defendant had a safe operating procedure document entitled "Procedure for the Use of Contractors" prior to the incident, which in clause 3 requires the provision of a safety cage by a contractor when changing tyres on split rims. Chrisohoidis had not been provided with a copy of this procedure. 33 The Full Bench in Capral stated at 650 that 'a breach where there was every prospect of serious consequences might be assessed on a different basis to a breach unlikely to have such consequences'. 34 The presence of foreseeability is also relevant to the objective seriousness of an offence. As was stated in Capral, the presence of foreseeability 'will necessarily result in the offence being more serious in nature'. As such, the starting point for the determination of foreseeability within the context of the objective seriousness of an offence is whether there was 'an obvious or foreseeable risk to safety against which appropriate measures were not taken'. ( Lawrenson Diecasting at 476). 35 Given all of the above as well as the absence of any instruction, supervision or proper risk assessment by either defendant, it was entirely foreseeable that Mr McPhillips' health and safety would be put at risk in undertaking the task of changing the split rim tyre in the circumstances that he did. That he was in a position to do so was the result of the collective failures of Mr Chrisohoidis and Suttons. 36 On the part of Suttons, there was a clear failure to observe the most basic of procedures designed to ensure that contractors who entered their worksite were verified at the time of arrival and that steps were taken by way of overall instruction and supervision to ensure that, once on site, such contractors carried out the work to be done free of risks to safety. 37 Prior to the accident involving Mr McPhillips, Suttons did have two relevant policy documents in place. One was titled Safe Operating Procedure for the Use of Contractors on Site. The second was titled Contractor's Code of Conduct. The former document has already been referred to in [27] above. The latter document stated relevantly: This is a reminder that contractors have an obligation to comply with the NSW OHS Act and regulations, and approved Codes of Practice, whilst working on any of our premises. They are required to develop a safe working method in their activities, before commencing any work for us, and the contractors are also responsible for ensuring their employees, work in a safe manner. The correct procedure is: · To provide the contractor and their employees with an induction program, and to make it clear they must adhere to our policies, and make them aware of our OHS, smoking, alcohol/drugs policies. (Give them a copy if necessary). · They require knowing, for example, our emergency procedures, speed limits and use of personal protective equipment. · Made aware of any apparent hazards on the premises and to keep the premises clean and tidy. 38 Given that Mr McPhillips was able to enter Suttons' worksite and undertake the tyre fitting task that led to his accident without any employee of Suttons being aware of his presence until his accident occurred highlights the failures of Suttons to observe the limited safety procedures it had in place. On that issue, Suttons accepted that Mr Chrisohoidis was frequently at their premises prior to Mr McPhillips' accident, that he fitted tyres at their premises and that Mr McPhillips frequently accompanied Mr Chrisohoidis on those excursions. 39 For example, when questioned as to how he entered the premises, Mr McPhillips answered that he "drove in" and had never seen any signs to indicate that he should report his attendance on site. Mr Schinella in his interview with Inspector Littley stated that the only "controls" on the premises were signs stating "no admittance" and staff actually seeing contractors on site and questioning them. What should have been in place was a system, such as a sign in system which required contractors to identify themselves to staff on site. That has now been done. 40 Despite awareness on the part of Suttons as to the above matters pertaining to contractors, it would appear they were never conveyed to Mr Chrisohoidis. Both Mr King and Mr Schinella, in separate interviews with Inspector Littley, stated that they were both unaware if Mr Chrisohoidis had prepared and tendered a safe work method statement for the tasks of fitting and assembling tyres. Further, as para [21] of the agreed facts confirms, Mr Chrisohoidis had never been provided with a copy of the Suttons' Safe Operating Procedure for the use of Contractors prior to Mr McPhillips' accident. 41 Mr Chrisohoidis had a responsibility to ensure that a risk assessment was undertaken for the task of fitting a tyre, that a safe work method existed and communicated to Mr McPhillips. It is abundantly clear that Mr Chrisohoidis not only failed to properly instruct and supervise Mr McPhillips but also allowed him to undertake work well beyond his basic expertise and experience thereby exposing him to risks to his safety. On any view, Mr McPhillips should not have been allowed to undertake the work he was doing at the time of his accident. 42 It is relevant to the objective seriousness of an offence to consider if there were readily and easily available remediation steps which could have been undertaken by the defendant before the accident to prevent injury occurring. To put it another way, one should have regard to remediation or the extent of remediation that is done post the accident, as an indication of the extent to which foreseeability of injury was readily identifiable. 43 Following the accident, Mr Chrisohoidis has put into place recommendations made by WorkCover, such as having a proper safety cage attached to his utility vehicle when undertaking tyre changing activities. Mr Chrisohoidis now undertakes such work himself and he ensures that he signs in when he attends a job site. He also obeys all safety regulations and rules and provides relevant insurance for persons who engage his for services. Mr Chrisohoidis is no longer offered truck tyre fitting jobs at Suttons, although he continues to perform work in their Cars Division. 44 Suttons undertook a risk assessment following the accident regarding tyre fitting on site. They concluded that the work should not have been done on site as Suttons did not have a proper safety cage on site. Further, in light of the difficulties faced in ensuring that safe work methods were followed by contractors, Mr King wrote to all tyre contractors used by Suttons advising that replacement tyres would no longer be fitted to rims on the premises unless a proper safety cage was utilised. 45 Suttons also revised its Code of Conduct for Contractors. This was introduced in November and December 2003. The amended Code of Conduct set out additional requirements such as being able to demonstrate that a safe system of work was in place to undertake the work as well as a safe work method. 46 Suttons' occupational health and safety procedures now require contractors to make themselves known to Suttons' staff when conducting work on site. Contractors are to sign in at either the office in the sales area or control room in the workshop, where their names are checked against the Approved Supplier List. This is done to ensure that the contractor's worker's compensation and insurance details are recorded and they have completed induction for the purposes of the Code of Conduct. While working on site, contractors are also required to wear safety jackets at all times. These safety jackets are coloured and numbered, allowing contractors to be easily identified by personnel should they be in areas where they are not allowed. 47 Both Suttons and Mr Chrisohoidis effected the identified remedial steps immediately. They were, on any view, steps that could and should have been in place prior to Mr McPhillips' accident. 48 In all the circumstances and having regard to all of the above, I identify the offences as being objectively serious and propose to consider penalty on that basis. Further, as submitted by counsel for the prosecutor together with the matters identified relevant to the respective culpability of each defendant, I agree that the relative culpability of each defendant is similar. 49 The decision of the Full Bench in Capral clearly indicates that general and specific deterrence are factors that should be given weight in all but exceptional circumstances. The Full Bench said at 643-644 that: We consider that the extract from the judgment of Hungerford J in Fisher v Samaras Industries Pty Limited accurately states the approach that members of this Court should take in relation to the question of deterrence, both general and personal or specific, when sentencing an offender in relation to a serious breach of the legislation. It follows that those aspects of deterrence are matters which should normally be given weight of some substance in the sentencing process. 50 In respect of specific deterrence, the Full Bench held in Capral at 644-645: In sentencing, a court may disregard the element of specific deterrence if satisfied that the risk of re-offending is low or non-existent. The court may form such a view as a result of the rehabilitation of the offender: R v Corner (unreported, Court of Criminal Appeal, 19 December 1997) or because the offender will not have the opportunity to commit a similar offence in the future: R v Macdonell (unreported, Court of Criminal Appeal, 8 December 1995). However, we think it unlikely that the weight to be attached to specific deterrence could be reduced to zero in cases of offences under the Act. 51 Both specific and general deterrence are relevant considerations in both of these matters as there is a real risk to safety posed in the type of work continuing to be undertaken by both defendants. Nevertheless, I believe considerations as to specific deterrence should be properly tempered having regard to the steps taken by both defendants to review and improve their relevant operating procedures such as to ensure a safe working environment. 52 I accept that Suttons took and does take its commitment to workplace safety seriously through regular occupational health and safety meetings and training as well as policies and procedures for contractors and measures such as the Premium Discount Scheme Audits. That audit was an initiative of WorkCover and granted employers a fifteen per cent discount on workers' compensation insurance premium contingent on an audit meeting standards set by WorkCover. Although the process has been abandoned by WorkCover, Suttons adopted it and continues to conduct these audits for occupational health and safety purposes. Prior to the accident involving Mr McPhillips, there had been no injuries to contractors or contractors' employees on any Suttons Group site. 53 It would be fair to say that prior to Mr McPhillips' accident, Mr Chrisohoidis did not have any formal procedures in place in relation to safe operating procedures. Nevertheless, as my earlier comments confirm, he has acted promptly to enact remedial steps designed to ensure, as best as possible, no repetition of the actions that precipitated Mr McPhillips' accident. 54 Mr Chrisohoidis has not made any direct submissions as to impecuniosity or financial hardship but he has tendered a statement of personal assets and liabilities as at 31 January 2006. The document reveals the total assets owned by Mr Chrisohoidis came to a total of $799, 000. Those assets consist almost entirely of the family home together with a residential unit in Queensland. His liabilities are listed at $142,370. Mr Chrisohoidis' surplus assets over liabilities total $656,630. 55 In assessing a defendant's position to pay a fine, the court is guided by s 6 of the Fines Act 1996 which states as follows: 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. 56 On the issue of incapacity to pay, I note the observation of the Full Bench in WorkCover Authority of New South Wales (Inspector Mansell) v Jian Chen and Obing Pty Limited trading as Old But New [2004] NSWIRComm 247 at [51] as follows: ... where a defendant desires to plead incapacity to pay as a determinative issue in the imposition of penalty, it behoves the defendant to discharge the onus that such a submission invokes by placing before the Court all of the information it relies upon in support of that submission in order for the Court to give that information proper consideration in the exercise of its sentencing discretion. 57 It is clear that any fine imposed will fall upon Mr Chrisohoidis alone to meet. His business is essentially a one man operation. The evidence before me as to surplus assets over liabilities does not assist the Court in coming to a proper understanding of Mr Chrisohoidis' trading and financial position having regard to his business operations reflecting, as they would, on his ability to pay a substantial fine. 58 In oral submissions by his counsel it was said that, after tax, his trading position reflected an overall net income of $40,000. 59 In the absence of any detailed financial material in relation to his business, the best I can conclude is that Mr Chrisohoidis is essentially a small business operated by himself with no other employees. Accordingly, the approach I propose to take is that, as enunciated by Wright J, President in Ferguson v Nelmac Pty Limited (1999) 92 IR 188 at 210 where his Honour stated: ... whilst I accept that the imposition of heavy fines would be a burden on the defendant and its financial resources and that consideration should be given appropriate weight on the question of penalty, it does not necessarily result in the Court not imposing a heavy penalty ... the penalty should reflect the objective seriousness of the offence. 60 Both defendants are also entitled to have their plea of guilty taken into account in determination of penalty. In doing so, the Court is guided by the decision of R v Thomson; R v Houlton (2000) 49 NSWLR 383, the principles of which are well settled and need no elaboration, reinforced as they are by s 22 of the Crimes (Sentencing Procedure) Act 1999. I assess that discount for each defendant at twenty five per cent. 61 There are additional subjective features which are mitigating factors for the defendants. I accept that both defendants have expressed contrition and remorse for the incident involving Mr McPhillips. Their cooperation with WorkCover's investigation has been acknowledged by the prosecutor and should also be taken into account. 62 In addition to the remedial steps taken by Mr Chrisohoidis as outlined above, Mr Chrisohoidis has also endeavoured to inform other tyre suppliers of the need to have in place a safety cage for relevant tyre fitting work. 63 Suttons has taken the accident very seriously. Its prompt internal investigation and rectification efforts of safety procedures following Mr McPhillips' accident is commendable. 64 Considering all of the subjective elements I have identified, a further discount as to penalty in favour of both defendants is warranted. 65 Taking into account all the matters that I have referred to, I determine penalty and make orders as follows: (1) Matter No IRC 4599 of 2005: WorkCover Authority of New South Wales (Inspector Littley) v George Chrisohoidis t/as Express Tyres: Prosecution arising under s8(2) of the Occupational Health and Safety Act 2000: (i) I impose a penalty in this matter of $9,750. (ii) I allocate a moiety to the prosecution on the usual terms. (2) Matter No IRC 4600 of 2005: WorkCover Authority of New South Wales (Inspector Littley) v Suttons Motors Arncliffe Pty Ltd: Prosecution arising under s8(2) of the Occupational Health and Safety Act 2000: (i) I impose a penalty in this matter of $97,500. (ii) I allocate a moiety to the prosecution on the usual terms. (3) I order the defendants to pay the costs of the prosecutor as agreed or assessed equally between them. Failing agreement, the matter may be referred to the Registrar for assessment. 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.